In the first week of 2025, TTF gas futures rose, reaching the highest settlement price since October 2023, above €50/MWh. This, coupled with rising CO2 prices and electricity demand, as well as declining photovoltaic energy production, supported higher prices in some of the main European electricity markets. In contrast, the increase in wind energy production led to lower prices in other markets. Portugal and France registered the second highest wind energy production in their history.
Solar photovoltaic and wind energy production
In the week of December 30, solar photovoltaic energy production declined across the board in the main European electricity markets compared to the previous week. The German market led these declines, with production using this technology falling by 29%. The French and Portuguese markets followed, with production declining by 25% in both markets. The Italian market registered the smallest decline, 6.6%, while in Spain the drop was 17%.
In the week of January 6, according to AleaSoft Energy Forecasting’s solar energy production forecasts, solar energy production will increase in Germany, while in Italy and Spain it will continue to decline.
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 first week of January, wind energy production increased in most major European markets compared to the previous week. The German and French markets registered the largest increases, 148% and 140%, respectively. The Iberian markets registered increases of 12% in Portugal and 19% in Spain. Meanwhile, the Italian market registered a 65% drop in wind energy production, marking a reversal of trend after two weeks of growth.
On Sunday, January 5, the Portuguese market reached its second highest wind energy production value in history, generating 108 GWh. The following day, the French market reached its second highest value ever, generating 416 GWh.
In the second week of 2025, according to AleaSoft Energy Forecasting’s wind energy production forecasts, production will increase in the Italian, Iberian and German markets, while it will decrease in France.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Electricity demand
In the week of December 30, electricity demand increased in most major European electricity markets compared to the previous week. The German market registered the largest increase, 8.6%, followed by the British and French markets, which had increases of 7.6% and 7.0%, respectively. The Italian, Spanish, Belgian and Portuguese markets had increases ranging from 2.6% in Italy to 6.2% in Portugal. The exception was the Dutch market, where demand decreased by 8.6%.
During the first week of 2025, average temperatures decreased compared to the previous week in most analyzed markets. The decreases ranged from 0.2 °C in Belgium to 2.0 °C in Great Britain. The exception was Germany, where temperatures were 0.1 °C higher.
The colder temperatures, coupled with the fact that work activity began to recover after the Christmas holidays in the last week of 2024, favored the increase in demand in the first week of 2025.
For the second week of January, according to AleaSoft Energy Forecasting’s demand forecasts, demand will continue to increase in the markets of Germany, Italy, Great Britain, Belgium, the Netherlands, Spain and Portugal, while it will decrease in France.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE, TERNA, National Grid and ELIA.
European electricity markets
In the first week of January, average prices in the main European electricity markets had a heterogeneous behavior. On the one hand, in the MIBEL market of Spain and Portugal, the IPEX market of Italy and the Nord Pool market of the Nordic countries, prices increased compared to the previous week. Price increases ranged from 5.1% in the Spanish market to 77% in the Nordic market. On the other hand, in the rest of the markets analyzed at AleaSoft Energy Forecasting, prices decreased between 4.8% in the N2EX market of the United Kingdom and 28% in the EPEX SPOT market of Germany.
In the week beginning on December 30, weekly averages exceeded €85/MWh in most analyzed European electricity markets. The exceptions were the Nordic market, which registered the lowest average, €34.96/MWh, and the German market, with a weekly average of €73.87/MWh. In contrast, the Italian market reached the highest weekly average, €140.39/MWh. In the rest of the analyzed markets, prices ranged from €85.87/MWh in the Belgian market to €114.34/MWh in the Portuguese market.
Regarding daily prices, most analyzed markets registered low prices on January 1. The German market registered the lowest price, €0.95/MWh. This daily price was the lowest since December 26, 2023, in the German market. On that day, the Belgian and French markets reached their lowest daily prices since November 25, 2024.
In the week of December 30, despite higher weekly gas and CO2 emission allowance prices, a decline in solar photovoltaic energy production, and increased electricity demand in most markets, high levels of wind energy production allowed prices to fall in markets such as the German and French markets. On the other hand, the fall in production with this technology contributed to the Italian market reaching the highest weekly average price.
AleaSoft Energy Forecasting’s price forecasts indicate that, in the second week of January, prices will reverse their trend compared to the previous week in most analyzed European markets. Significant increases in wind energy production in the Spanish, Italian and Portuguese markets will favor the decrease in prices in these markets, while the rest of the markets will register price increases.
Source: Prepared by AleaSoft Energy Forecasting using data from OMIE, EPEX SPOT, Nord Pool and GME.
Brent, fuels and CO2
Brent oil futures for the Front?Month in the ICE market registered price increases in the first week of January. On Monday, December 30, these futures registered their weekly minimum settlement price, $74.39/bbl. As a result of the upward trend, on Friday, January 3, these futures reached their weekly maximum settlement price, $76.51/bbl. According to data analyzed at AleaSoft Energy Forecasting, this price was 3.2% higher than the previous Friday and the highest since October 15, 2024. Subsequently, on Monday, January 6, the settlement price declined compared to the previous session, standing at $76.30/bbl.
In the first week of January, prospects of increased demand due to low temperatures, possible increases in sanctions on Russian and Iranian oil, as well as expectations that stimulus to the Chinese economy will lead to increased demand in 2025, led to higher Brent oil futures prices.
As for TTF gas futures in the ICE market for the Front?Month, on Monday, December 30, they registered their weekly minimum settlement price, €47.63/MWh. Subsequently, prices increased. As a result, on Thursday, January 2, these futures reached their weekly maximum settlement price, €50.20/MWh. According to data analyzed at AleaSoft Energy Forecasting, this price was the highest since October 31, 2023. On Friday, January 3, the settlement price was down 1.3% from the previous day, at €49.54/MWh. This price was still 3.8% higher than the previous Friday. On Monday, January 6, the settlement price dropped again to €47.33/MWh.
In the first week of January, TTF gas futures prices increased influenced by the termination of the Russian gas supply contract via Ukraine. Low temperatures and the rate of decline in European reserve levels also contributed to this trend. Following the supply disruption, prices reached their maximum value on Thursday, January 2.
Regarding CO2 emission allowance futures in the EEX market for the reference contract of December 2025, they remained above €70/t during the week of December 30 and exceeded €75/t in the first two sessions of January. On Friday, January 3, these futures registered their weekly maximum settlement price, €75.94/t. According to data analyzed at AleaSoft Energy Forecasting, this price was 6.1% higher than the previous Friday and the highest since June 4, 2024. On Monday, January 6, the settlement price fell back to €74.36/t.
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, hybridization and PPA
The 51st webinar of the monthly webinar series of AleaSoft Energy Forecasting will take place on Thursday, January 16. This webinar will feature speakers from PwC Spain for the fifth time since these webinars have been held. In addition to the evolution and prospects of European energy markets, the webinar will analyze the prospects for energy storage and hybridization. It will also address industry electrification, the current state of regulation on PPA and renewable energy, as well as virtual PPA and FPA.
