Cold Wave Hits Energy Transition: German Electricity Prices Suddenly Explode...

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by Flynn Jacobs at Berliner-Zeitung

The German electricity price is at its highest level in seven months. The reasons are the cold wave and concerns about falling production from renewable energies.

The Energy transition in Germany, progress continues. The Federal Republic should become climate neutral by 2045 – at least that is the declared goal of the policy. Indeed, renewable energy covered according to the Federal Association of Energy and Water Management (BDEW) in the first three quarters of 2025, almost 57 percent of electricity consumption. But the energy transition also brings with it challenges: The Electricity prices increasingly depend on the weather – and this is clearly noticeable again at the moment.

In Germany, electricity prices have risen to their highest level since February as a result of the cold snap and concerns about lower electricity production from renewable energies. The Reported the US news agency Bloomberg, citing data from the energy exchange EEX. The German monthly price increased by up to 3.6 percent to 99.79 euros per megawatt hour. European gas prices also rose as forecasts for colder weather point to rising heating demand in the coming weeks. Temperatures in Germany are expected to be around two degrees below the long-term average from mid-October.

Higher electricity prices: Experts warn of weather dependency

“German electricity prices have risen primarily due to fears of colder weather and lower than usual electricity generation from renewable energies“, said Yiannis Papamikrouleas, head of futures trading for energy markets at Depa Commercial SA. Weak wind conditions had already driven up electricity prices in Europe last winter. According to BloombergNEF, average wind speeds fell in countries such as Germany and Great Britain by up to one meter per second by 2024 compared to the years 2010 to 2015 – with corresponding effects on electricity production.

The increasing weather dependence of electricity generation is increasingly pushing the energy system to its limits. Even in the summer, Germany had to use wind and solar systems in record quantities due to the slow expansion of the grid and a lack of storage capacity throttle. According to data from the financial market data provider LSEG, solar power production was reduced by around eight percent in the first half of the year – more than twice as much as in the previous year. The Wind power had to be shut down temporarily to avoid overloading the network. Experts see this as a growing risk of price spikes when weak electricity generation from renewable sources meets increasing demand.

If wind and sun are missing at the same time, more expensive fossil power plants have to step in – or electricity is imported from abroad. In February of this year, an exceptionally low-wind phase led to a Historic price increase on the electricity exchange. Energy experts warn that such situations could occur more frequently in the future if the expansion of battery storage and weather-independent reserve capacities, for example through hydrogen-capable Gas power plants, continues to falter. Network expansion and flexible storage solutions are therefore considered crucial to making the energy transition weatherproof.