Tuesday, November 5, 2024

Electricity prices in Europe are going negative – and that’s bad

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Negative electricity prices can make more economic sense than switching wind turbines off

Peter Brogden/Alamy

The huge growth in renewable energy across Europe means electricity plants are generating more power than is needed, forcing them to pay energy firms to discharge it – effectively, selling at a negative price. On the face of it, this might seem like a good thing for cash-strapped households, but negative prices don’t necessarily bring down people’s electricity bills, and can also bring a host of downsides, including disrupting the business case for building more renewables.

The price of power is largely determined by the “day-ahead”…

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