On Tuesday, day-ahead prices in Germany reached a new high.
According to data from the European Energy Exchange AG, power prices in the EU soared to a new record high on Tuesday as natural gas prices increased further due to a decline in Russian supplies.
According to market data provider Nord Pool, benchmark day-ahead prices in Germany increased to €490.79 ($497) per megawatt-hour from an average of €218.03 in June.
Prices today are roughly six times higher than they were in August 2021.
Fears about the capacity of power plants to produce enough electricity this winter in the face of a tightening gas supply have rattled the EU's energy market.
Due to sanctions on Ukraine and technical difficulties, the Russian gas supply has decreased this year, which has caused gas prices in the region to increase by a factor of four. By acquiring additional LNG and pipeline gas from Norway, Algeria, and Azerbaijan, EU nations have been attempting to diversify their import sources. Josep Borrell, the senior diplomat for the EU, claims that the union is "approaching the boundaries of what more gas" it can purchase from "non-Russian sources." While other EU nations have been reviving coal-fired reactors, France has been turning more and more to nuclear energy to produce additional electricity.
However, the "extreme" price increase is showing no signs of slowing down, according to Rystad Energy analyst Fabian Ronningen, as the exextranuclearhydropower, and coal capacity is insufficient to counteract the effects of the declining Russian gas supply.