Cold wave hits energy transition: German electricity prices suddenly explode

German electricity prices have surged to their highest level in seven months due to a cold snap and concerns over declining renewable energy production. Prices rose by up to 3.6% to €99.79 per megawatt-hour. This trend is concerning as demand for heating increases with colder temperatures forecasted.

Experts warn that electricity prices are increasingly dependent on weather conditions. "German electricity prices have risen mainly 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. The ongoing challenges of integrating renewable energy could lead to more frequent price spikes, particularly during times of low wind and solar generation.