EMERGENCY ENERGY MEASURES IN EUROPE: COUNTRIES RETURN TO GAS

Electricity prices have soared in Europe as declining wind generation has forced countries to switch back to fossil fuels.

Poland’s PSE electricity grid introduced a so-called state of emergency on the power capacity market on Wednesday. The decline in UK wind generation means the country’s reliance on gas-fired power generation is at its highest level since November 2023, according to Elexon data.

Electricity prices in Germany rose during peak traffic hours on Wednesday, hitting their highest level since the peak of the energy crisis. The severe conditions, driven by reliance on renewable energy on a day with little wind, occurred despite temperatures in much of northwestern Europe being above the 30-year average, according to Weather Services International.

The decline in wind generation has boosted demand for gas for power generation, which supported fuel prices earlier this week.

Some countries have even had to increase the use of winter gas reserves to meet demand. On Monday, according to the latest data from Gas Infrastructure Europe, net gas withdrawals from the European Union's total reserves exceeded 2 terawatt hours. This is the largest selection since the start of this heating season.