Christmas brought no negative electricity prices in Czechia this year as wind weakened ahead of the holidays

Christmas is traditionally a period of lower electricity consumption, especially on Christmas Eve and during the holidays that follow. This usually puts pressure on electricity prices, although they are also affected by generation. While last week saw very strong wind power generation across Central and Western Europe, winds weakened significantly during Christmas week. Unlike last year, spot market electricity prices therefore did not fall into negative territory.

Short-term electricity markets have not faced a surge in negative prices towards the end of this year, as they did last year, for example. The main factor affecting spot market prices is electricity generation from wind farms, particularly in northwestern Europe. Germany and other countries in the region have already experienced several periods of low output from wind and solar sources this year, also known as Dunkelflaute.

One such recent period began in early November, when spot electricity prices climbed into the hundreds of euros. Another sharp rise in electricity prices occurred in mid-December, when the German network regulator even said it would investigate whether market manipulation had taken place during that period.

In the second half of December, however, the situation changed as wind power generation increased significantly. It did not remain at high levels until Christmas, though, and the subsequent drop in wind generation helped push spot prices above the levels seen before Christmas.

Lower wind generation in Germany and neighboring countries also supported electricity prices on the Czech market. While spot prices during the holidays in 2023 generally stayed close to zero or even fell into negative territory, this year they have been fluctuating around 100 EUR/MWh. This afternoon, wind power generation in Germany is even expected to fall below 3 GW. The country's installed wind capacity, however, is around 70 GW.