This week, European power prices fell to below zero for the second time this month, largely due to solar farm production.
Between 13:00 and 15:00 Central European Time on 4 July the power market turned negative according to market data from Epex Spot SE.
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It is becoming increasingly common for European power prices to fall into negative figures as the bloc pushes for greater renewables installation. The EU has set a target for 42.5% of its energy to come from renewable sources by 2030.
During periods of high production, it is cheaper for certain power plants to pay customers to use more electricity than it would be to shut the plant down.
The power price plunge follows another drop below zero, which took place during the weekend, also resulting from a surge in solar generation.
Negative power prices are more likely to occur on weekends, when average energy use tends to be lower. Germany, Denmark and the Netherlands are expected to see more negative power prices throughout the rest of the week.
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By GlobalDataNegative prices are more common in countries with limited energy storage as the excess cannot be used at a later point.
According to recommendations from the European Association for Storage of Energy (EASE), which have been adopted by the European commission, the EU will require 200GW of energy storage by 2030 and 600GW by 2050. Currently, the majority of Europe’s energy comes in the form of pumped hydro storage, whereby water is pumped from one reservoir to another, allowing its release to generate electricity during periods of energy shortage.
On Thursday, EASE announced €11m ($12m) of funding for a pumped hydro storage project in Estonia, which falls under the EU Projects of Common Interest.
“The global electricity sector faces the challenge of integrating intermittent renewable generation while ensuring electricity supply reliability, security and affordability,” said Peep Siitam, CEO of Energiasalv, the company building the project.
