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Energy

Market analysis

The Commission produces quarterly reports on EU gas and electricity markets.

Gas and electricity market reports

Energy prices have a significant impact on household expenditures, industrial costs and business competitiveness. In a liberalised market, monitoring market prices has become increasingly important for analysts, policy makers and businesses alike.

The EU quarterly gas and electricity market reports analyse market data in detail to examine trends and challenges. The reports explore the main factors behind price and volume variations and the interaction between market actors.

The European Union is currently facing a sharp spike in energy prices. In response, the Commission adopted a Communication on “Tackling rising energy prices: a toolbox for action and support” to enact and support appropriate measures to mitigate the impact of the current energy price rises and help Europe's people and businesses, while further strengthening resilience against future shocks. The implementation of the measures proposed in the toolbox will impact price developments in the EU.

Every 2 years, a report on energy prices and costs in Europe is published, taking stock of the recent trends for gas, electricity and oil prices, as well as other energy costs.

Gas market - recent developments

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In the first quarter of 2022, geopolitical tensions exacerbated after Russia launched an invasion on Ukraine in February 2022, reinforcing uncertainty around the European security of gas supply and price volatility on the European gas markets. The daily TTF spot rose as high as 212 €/MWh on 7 March.

As consequence of Russia’s aggression, the European Union has adopted a series of sanctions with a key impact on the energy sector. The EU also adopted its REPowerEU plan in May 2022, where it outlines measures to phase out Russian fossil fuel imports, increase security of energy supply and support the green transition.

Russian gas imports continued to fall through both the Belarus (-71% year-on-year) and Ukrainian transit routes (41%) in Q1 2022. In early June, flows through Nord Stream were cut back in two steps by 60%. Russian pipeline supplies ensured only 28% of the total extra-EU gas imports in Q1 2022, whereas 34% of them arrived in the form of Liquefied Natural Gas (LNG). EU net gas imports rose by 10%, whereas LNG imports were up by 72%. The EU spent an estimated €78 billion on gas imports in Q1 2022 (of which €27 billion related to Russian imports).

On 31 March 2022, the average EU gas storage filling rate was 26%, around 4 percentage points lower than a year before. Spot prices on the European gas hubs were in Q1 2022 in the range of 95-100 €/MWh. Retail gas prices for households in EU capital cities were up by an estimated 84% in May 2022 year-on-year.

EU quarterly gas market reports

Electricity market - recent developments

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In the first quarter of 2022, the electricity market was marked by the impact of the Russian invasion of Ukraine and the fears of supply disruption, amid record prices and high volatility. The European Power Benchmark averaged 201 €/MWh in Q1 2022 – 281% higher than in Q1 2021.

The largest year-on-year wholesale price increases in EU countries were registered in Spain and Portugal (+411%), Greece (343%) and France (+336%). Italy reported the highest quarterly average price (249 €/MWh), which was 318% higher than in Q1 2021.

Carbon allowances registered a new peak in early February, climbing above 96 €/tCO2, fell in early March and then bounced back to prices around 80-85 €/tCO2. For the first time since the rally in gas prices started, TTF prices stopped supporting the price of EU allowances.

Despite increased levels of fossil generation, the share of renewables still managed to reach 39%, outperforming fossil fuels (37%) in Q1 2022. Compared to Q1 2021, renewable generation increased its output by 1% (+1 TWh) as a result of an increase of 20% (+20 TWh) in onshore wind, 31% of solar (+8 TWh) and 8% of offshore wind (+1 TWh), despite hydro output falling by 27% (-28 TWh) in Q1 2022 on a yearly basis. In the same period, fossil fuels climbed 6% (+17 TWh) and nuclear generation fell 9% (-16 TWh).

The demand for electrically chargeable vehicles (ECVs) increased during the first quarter of 2022 year-on-year (+19%). More than 423,000 new ECVs were registered in the EU in Q1 2022.

EU quarterly electricity market reports

Energy data centre

Consistent and accurate data is very important for a reliable analysis that can be used as the basis to develop energy policies or investment planning.

For data and analysis, the Directorate-General for Energy relies on the Market Observatory for Energy, which maintains and operates the Energy market observation system (EMOS), a database of information collected from a wide range of private and public entities.

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