Photovoltaic energy continues to set records, but cold weather and CO2 prices make European electricity markets more expensive in the third week of January

In the third week of January, prices rose in most major European electricity markets, driven by lower wind energy production, increased demand due to colder temperatures and higher gas and CO2 prices. On January 17, CO2 futures reached the highest settlement price since late May. Solar photovoltaic energy production increased, setting all?time records for a January day in Spain, Portugal and France. On the 15th, Brent futures registered the highest settlement price since mid?August.

Solar photovoltaic and wind energy production

In the week of January 13, solar photovoltaic energy production increased in the main European electricity markets compared to the previous week. The German and French markets continued their upward trend for the second week in a row, while the Italian and Iberian markets reversed their trend after two weeks of declines. On this occasion, the Portuguese market registered the largest percentage increase, 87%, while the Italian market registered the smallest increase, 16%. The German, Spanish and French markets registered increases of 41%, 58% and 61%, respectively.

During the week, solar photovoltaic energy production reached all?time generation records for a January day in most analyzed markets. In the French and Spanish markets, this occurred on the 13th and 14th, with production of 60 GWh and 111 GWh, respectively. The Portuguese market set its daily production record for a January month on Friday 17, with 15 GWh of generation.

In the fourth week of January, AleaSoft Energy Forecasting’s solar energy production forecasts indicate an increase in the German and Italian markets, while they predict a decrease in the Spanish market.

AleaSoft - Photovoltaic energy production electricity Europe

Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.

In the third week of 2025, wind energy production decreased in all major European markets compared to the previous week. The Italian market registered the smallest decline, 19%, while the French market registered the largest drop, 69%. The Portuguese, Spanish and German markets registered declines of 28%, 60% and 65%, respectively. The French, German and Iberian markets shifted to a downward trend after the increases over the past two weeks.

For the week of January 20, according to AleaSoft Energy Forecasting’s wind energy production forecasts, production will increase in the French, German and Spanish markets. In contrast, the Portuguese and Italian markets will continue to register declines in generation with this technology.


Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.

Electricity demand

In the week of January 13, electricity demand increased in most major European electricity markets compared to the previous week. The French market registered the largest increase, 15%, while the Belgian market showed the smallest growth, 1.0%. The Portuguese and German markets registered increases of 1.5% and 3.7%, respectively. On the other hand, the Spanish, Dutch and Italian markets registered increases of 11% in all three cases. The British market was the exception, with demand declining by 6.5%.

Most analyzed markets maintained their upward trend for the third consecutive week, with the exception of the Dutch and British markets. The Dutch market maintained its upward trend for the second week, while the British market registered a downward shift.

During the week, average temperatures were lower than those of the previous week in most analyzed markets. Decreases ranged from 1.7 °C in Belgium to 5.4 °C in Spain. This decrease in average temperatures drove the increase in demand in these markets, further accentuated by the recovery in activity following the January 6 holiday, Three Kings Day, which was celebrated in some markets the previous week. In contrast, the British market registered temperatures on average less cold than those of the previous week, with an increase of 4.2 °C, which favored the reduction in demand.

For the week of January 20, AleaSoft Energy Forecasting’s demand forecasts indicate an increase in the markets of Germany, the Netherlands and Great Britain. On the other hand, demand will decline in the markets of France, Spain, Italy, Belgium and Portugal.


Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE, TERNA, National Grid and ELIA.

European electricity markets

In the third week of January, average prices in most major European electricity markets increased. The exceptions were the N2EX market of the United Kingdom and the Nord Pool market of the Nordic countries, with decreases of 13% and 58%, respectively. In contrast, the EPEX SPOT market of Germany registered the largest percentage price increase, 63%. In the rest of the markets analyzed at AleaSoft Energy Forecasting, prices increased between 12% in the IPEX market of Italy and 57% in MIBEL market of Spain.

In the week of January 13, weekly averages exceeded €130/MWh in almost all analyzed European electricity markets. The exception was the Nordic market, which registered the lowest average, €21.25/MWh. The Italian and German markets reached the highest weekly averages, €147.43/MWh and €147.93/MWh, respectively. In the rest of the analyzed markets, prices ranged from €132.86/MWh in the Portuguese market to €142.98/MWh in the Dutch market.

Regarding daily prices, in the third week of January, the analyzed electricity markets reached their highest averages on January 15. In the case of the German and Dutch markets, daily averages exceeded €200/MWh. Later, at the beginning of the fourth week of January, on Monday, January 20, prices were even higher. On that day, the German, Belgian, British and Dutch markets registered daily prices above €200/MWh. The German market reached the highest price, €231.36/MWh. In the Italian and French markets, on January 20, prices were the highest since January 25, 2023, €192.84/MWh and €196.71/MWh, respectively.

In the week of January 13, the increase in the weekly price of gas and CO2 emission allowances, the fall in wind energy production and the increase in demand in most markets led to higher prices in most European electricity markets. However, electricity demand fell in Great Britain, contributing to the price decline in this market.

AleaSoft - Solar Panels

AleaSoft Energy Forecasting’s price forecasts indicate that, in the fourth week of January, prices will fall in most European electricity markets, influenced by increased wind energy production. In addition, demand will fall in some markets.


Source: Prepared by AleaSoft Energy Forecasting using data from OMIE, EPEX SPOT, Nord Pool and GME.

Brent, fuels and CO2

In the third week of January, settlement prices of Brent oil futures for the Front?Month in the ICE market rose compared to those of the previous week and exceeded $80/bbl in most sessions. The exception was Tuesday, January 14. On that day, these futures registered their weekly minimum settlement price, $79.92/bbl. After a 2.6% rise, they reached their weekly maximum settlement price, $82.03/bbl, on January 15. According to data analyzed at AleaSoft Energy Forecasting, this price was the highest since August 13, 2024. Subsequently, prices declined. On Friday, January 17, the settlement price was $80.79/bbl, still 1.3% higher than the previous Friday.

Supply concerns due to sanctions on Russian oil, as well as the possibility of further sanctions on Iranian and Venezuelan oil, drove Brent oil futures prices higher in the third week of January. However, the easing of tensions in the Middle East due to the ceasefire agreement between Israel and Hamas exerted a downward influence on prices in the last sessions of the week.

As for TTF gas futures in the ICE market for the Front?Month, on Monday, January 13, they registered a price rise of 7.2% compared to the last session of the previous week. On that day, they reached their weekly maximum settlement price, €48.26/MWh. According to data analyzed at AleaSoft Energy Forecasting, this price was the highest since January 4, 2025. On the other hand, on Thursday, January 16, these futures reached their weekly minimum settlement price, €46.24/MWh. On Friday, January 17, the settlement price increased by 1.4% compared to the previous day, reaching a value of €46.89/MWh. This price was 4.2% higher than the previous Friday.

In the third week of January, settlement prices of TTF gas futures remained above €46/MWh, influenced by colder temperatures and the decrease in European reserve levels.

Regarding CO2 emission allowance futures in the EEX market for the reference contract of December 2025, they registered their weekly minimum settlement price, €76.92/t, on Monday, January 13. This price was already 2.8% higher than the previous Friday. The upward trend continued throughout the week. As a result, on Friday, January 17, these futures registered their weekly maximum settlement price, €79.26/t. According to data analyzed at AleaSoft Energy Forecasting, this price was 5.9% higher than the previous Friday and the highest since May 28, 2024.


Source: Prepared by AleaSoft Energy Forecasting using data from ICE and EEX.

AleaSoft Energy Forecasting’s analysis on the prospects for energy markets in Europe, energy storage and hybridization

On Thursday, January 16, AleaSoft Energy Forecasting held its 51st webinar. This webinar featured speakers from PwC Spain for the fifth time in the monthly webinar series. On this occasion, the webinar analyzed the evolution and prospects of European energy markets, the prospects for energy storage and hybridization, industry electrification, the current state of regulation on PPA and renewable energy, as well as virtual PPA and FPA (Flexibility Purchase Agreements).

The webinar highlighted that in the current five?year period significant development is expected in batteries and hybridization, areas in which AleaSoft Energy Forecasting’s AleaStorage division is providing services to drive these technologies. These services include revenue and profitability calculations for systems with energy storage, as well as optimal storage sizing for hybrid systems. These solutions are provided for both stand?alone projects and hybrid systems of renewable technologies, such as solar or wind energy, with energy storage systems.