Germany’s Gas Use and Power Prices Jump Amid Weak Wind Generation
Oil price | Dec 11, 2024 | Tsvetana Paraskova

Intraday power prices in Germany jumped and natural gas-fired electricity generation rose to a two-year high this week as low wind speeds continue to depress wind power output.

Natural gas use for power generation rose on Wednesday to its highest level since December 2022, as a wider power supply gap had to be filled by fossil fuels amid very weak wind power generation.

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Germany’s power margin, the available electricity supply to meet demand, has dropped this week to the lowest level so far this winter, as low wind speeds and colder weather are straining the power system.

This week, wind speeds in Germany have dipped again, while colder-than-usual temperatures have settled over much of northwest Europe.

Since early November, the so-called ‘Dunkelflaute’, German for “dark wind lulls”, have often resulted in wind farms in Europe’s biggest economy generating only a fraction of their nameplate capacity, leading to day-ahead electricity prices for peak demand hours to high levels not seen since the peak energy crisis in 2022.

Near-term power prices have increased as supply has been fluctuating while demand has been growing with the colder temperatures. Germany has had to import more electricity from France and rely more on fossil fuels for power generation during periods of low wind speeds.

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Germany has to grapple with higher hourly power prices and increased gas demand…