Electricity prices in southeastern Europe exceeded EUR 700/MWh. The most expensive 15-minute periods were around 8 pm

Drought and heat reduced generation at nuclear and hydroelectric power plants in the Danube basin, while prices on exchanges in the region surged by 50 to 100 percent compared with previous weeks. The peak of EUR 717/MWh was reached on 3 August on Slovenia’s BSP SouthPool exchange. However, an analysis of seven exchanges shows that price spikes were not evenly spread, but concentrated in four 15-minute trading intervals between 19:30 and 20:30, when photovoltaic generation ends while demand has not yet fallen.

The phenomenon in these markets was caused by a confluence of circumstances unprecedented in the region in recent years. According to an analysis by Balkan Green Energy News, which processed day-ahead market data from seven exchanges for the period from 31 July to 6 August, Hungary’s Paks nuclear power plant cut output by 90 percent due to a shortage of cooling water from the Danube. Of its installed capacity of 2,000 MW, it was generating around 230 MW. Romania’s Cernavodă reduced output by half, while Slovenia’s Krško cut output by a fifth due to the high temperature of the Sava River.

Hydropower plants fared no better. Serbia’s Đerdap 1 was operating at 20 percent of its usual output and Đerdap 2 at 30 percent. Montenegro’s Pljevlja thermal power plant was offline for several days. At the same time, regional demand rose by 5 to 20 percent due to the heatwave.

The problem was concentrated in one hour a day

According to the analysis, the highest prices were concentrated in four 15-minute trading intervals between 7:30 pm and 9 pm. This is precisely the period when photovoltaic generation declines with the setting sun, while demand remains high or continues to rise.

The loss of nuclear and hydropower capacity did not cause this evening ramp, but merely removed the reserve that had previously covered it. The crisis therefore did not manifest itself as a widespread electricity shortage throughout the day, but as a shortage of dispatchable capacity in a specific hour.

Countries with batteries had the lowest prices

According to the analysis, the lowest prices in the region were consistently recorded in Greece and Bulgaria. Both countries have the largest installed capacities of photovoltaics and battery storage, which can cover evening demand. According to the data, Greece has 9 GW of photovoltaic capacity and 1 GW of battery storage, while Bulgaria has 6 GW of photovoltaics and 3.7 GW of batteries.

Bulgaria was also helped by a technical factor. The Kozloduy nuclear power plant is also located on the Danube, but thanks to the design of its cooling system, it was able to secure sufficient cooling water even at low water levels and did not restrict operations.

On 31 July, the Romanian government declared a state of alert in the energy sector for the whole of August and subsequently adopted a mechanism under which transmission system operator Transelectrica may curtail consumption by industrial customers and reduce or cancel contracted electricity exports. Households and hospitals are exempt from the restrictions. Transelectrica must warn industrial consumers at least 24 hours in advance, and they are not entitled to compensation for electricity supply curtailments.

Acting Prime Minister and Energy Minister Ilie Bolojan said that exports would take place only in hours of surplus, and therefore not during the evening peak. More than eighty large industrial consumers also postponed shutdowns or reduced production. Carmakers Dacia and Ford suspended operations until 19 August, which, according to the government, means a reduction in demand of around 200 MW.

Moldova adopted similar measures on 3 August. It restricted commercial electricity exports between 18:00 and 22:00 and accelerated the grid connection of battery storage, solar and wind power plants, including by simplifying permitting procedures. The Energy Ministry also called on households and businesses to reduce consumption between 19:00 and 23:00 until 31 August.

There was also a reverse flow. Romania’s state-owned Nuclearelectrica announced that it had begun importing electricity from Ukraine via Moldova’s state-owned Energocom in order to mitigate the impact of the shutdown of Cernavodă’s first unit on the Romanian market.