Daily Management Review

Price of RES generation doubles in Europe


Cost of long-term contracts for the purchase of green electricity has nearly doubled in the European Union.

As RES generation costs soar to record highs of €100 per 1 MWh, they are now three times as expensive as developing new green electricity generation.

Due to gas shortages and the EU's wish to transition to the more expensive purchase of LNG, supply prices are rising. Analysts predict that European customers would reject long-term agreements and begin constructing RES on their own dime, accelerating the EU's transition away from fossil fuels.

According to data from the Pexapark platform, the cost of supplying green electricity under long-term PPA (Power Purchase Agreement) contracts has increased significantly in the EU.

Since the beginning of the year, the average Pexapark index across the EU for all types of RES has climbed by nearly 49%, reaching €96.6 per MWh. The historical peak of the index for offshore wind farms (WPPs) was €128.5 on May 5; for onshore WPPs, it was €89 on July 7; and for solar power plants, it was €106 on May 12 (SPPs).

source: pexapark.com