The European electricity market: what decision-makers should watch
Briefing: Under the merit-order principle, the most expensive plant still needed sets the power price.
Under the merit-order principle, the most expensive plant still needed sets the power price.
For executives, the main question regarding “The European electricity market” is their own exposure: which costs, revenues and financing conditions depend on it, directly or indirectly?
A proven approach is to run scenarios and monitor leading indicators regularly. That puts decisions on a solid footing without reacting to every headline.
The debate around “The European electricity market” is not new, but it has grown more urgent since 2022. The energy price shock, the turn in interest rates and geopolitical tensions have called many old certainties into question.
Economists and industry bodies assess the situation in different ways. Most agree, however, that reliable conditions for investment decisions are crucial.