Day-ahead market

Energy on the day-ahead market stood at 274 TWh in 2023 (175 TWh on the spot market without bilaterals), a decrease of 1.1% compared to 2023. 64% of the energy was traded on the spot market and the remaining 36% via bilaterals, so the spot market got a slightly higher share than in previous years.

Percentage of energy purchased in the day-ahead market and through bilateral contracts

%

The average price on the day-ahead electricity market in 2024 was €63.04/MWh, 27.6% lower than the previous year. Despite this decrease, it remains the fifth-highest price in history, following those of 2022 (€167.52/MWh), 2021 (€111.93/MWh), 2023 (€87.10/MWh), and 2008 (€64.43/MWh). The increased share of renewables and the decline in gas prices contributed to the drop in wholesale electricity prices.

Although prices were lower in 2024, the year exhibited an upward trend, in contrast to the previous year. Prices initially declined, reaching a historic monthly low in April. However, they then began an upward trend, with a slight dip in September and October, before peaking in December at the highest price of the year. This December price was the highest recorded since February 2023, the second-highest for any December, and the 17th highest in history. April was the first month to record negative hourly prices.

Evolution of prices in the day-ahead market

The highest daily price for the year was recorded on 12 December at €146.67/MWh, while the lowest price of the year was recorded on 5 April at €0.44/MWh. This latter price is the third lowest in history, following those recorded on 28 and 30 March 2013 (€0.13 and €0.31/MWh, respectively). April was the first month to record values below €0/MWh. The lowest hourly prices in history were recorded on 16 and 23 June at -€2/MWh.

In 2024, there were 784 hours with prices at or below €0/MWh, and in 247 of those hours (32%), prices were negative. In April, 107 hours with negative prices were recorded; in May, 35 hours; in June, 48 hours; in July, 30 hours; in August, 4 hours; in September, 18 hours; and in October, 5 hours.

The highest monthly prices were recorded in December (€111.24/MWh) and November (€104.43/MWh), while the lowest occurred in April (€13.67/MWh) and March (€20.31/MWh), months with high renewable energy generation from wind and solar photovoltaic sources.

Taking into account the generation mix in the day-ahead market, an important factor in price formation, it becomes evident that a higher share of renewables in the clearing structure influences a lower price and, conversely, a lower share increases the wholesale price.

April, the month with the highest percentage of renewable energy in market clearing, recorded the lowest monthly price, which, as previously mentioned, was the lowest in history and the first month to register negative values. The next month with the highest share of renewables was May, although this month had the third lowest price, not the second, which corresponds to March. May had the highest percentage of wind and solar power generation for the year, followed by April. March had a producible hydroelectric index of 1.7 and the highest reservoir levels for the year, reaching the historical average storage levels of the past 20 years. As a result, it seems reasonable that the prices for this technology were not as high as when reservoir capacity is lower.

Generation structure in the day-ahead market clearing process, price of the day-ahead market, and price of natural gas

The share of renewable energy in the electricity generation structure for market clearing in 2024 was 74.3%, higher than the previous year's 71.8%. Except for January and November, every other month saw a higher share of renewable energy in market balancing compared to 2023. Nuclear energy tripled its share, as it was not allocated through bilateral agreements as in previous years. The share of combined cycle generation decreased by almost 61%, while that of coal dropped by 17%. Wind power generation remained almost unchanged, with a slight 0.3% increase, whereas solar generation rose by 21.6% (23.8% for solar photovoltaic and 10.2% for solar thermal).

Another factor influencing the price is reserves. This year, hydroelectric reserves recorded a higher value than the previous year (1.2 compared to 0.9 the year before): Although reservoir levels ended the year just one percentage point above last year's, they remained above the historical average for most months. In fact, they reached a record high in May and came very close in the surrounding months, exerting a more favourable influence on prices compared to the previous year.

The price of fuels is another influencing factor. This year, the reduced use of the combined cycle and the containment of gas prices has meant that both prices are more decoupled than in previous years, except for the last months of the year. Gas prices started the year continuing the downward trend seen in the last months of 2023. However, after reaching a low in February, they began an upward trend, with slight declines in July and September, before peaking in November and remaining near that level in December. Instability in the Middle East, combined toward the end of the year with concerns over a potential reduction in liquefied natural gas supply from Qatar and a drop in reserves due to cold weather, led to significant volatility and an overall upward trend in gas prices. The European gas price turned out to be $10.96/MMBtu, 16.4% lower than the price recorded in the previous year. While this is the lowest price in the past four years, one would have to go back to 2013 to find a higher value. The MIBGAS price for 2024 was around €35/MWh, 11% lower than last year's price. The price of coal was also lower this year compared to last year and 2021. The Brent price closed at $78.73/barrel, down from $82.62/barrel last year. Geopolitical concerns, OPEC production decisions, the slowdown in global economic growth (offset by high demand from China), and uncertainty surrounding U.S. monetary policy and electoral cycle contributed to high volatility. Prices fluctuated between $90.05 per barrel in April and $72.29 per barrel in November.

As for emission prices, they were 28% lower than last year. They followed an upward trend during the first months of the year but shifted downward from September onward. Prices ranged between €55.4/tCO_₂ in February and €70.4/tCO_₂ in May.

Plotting the structures of the generation cleared in the hours in which the day-ahead market price marked the annual minimum and maximum, it can be seen that they are very different. In the hours of minimum price, solar photovoltaic energy accounts for almost 60% of the generation structure, with renewables accounting for more than 92%. Observing the mix in the hours of maximum price, it can be seen that the combined cycle has the highest share in the generation structure (39.9%). During those hours, renewable energy generation accounted for slightly less than 38% of the generation structure, even though they set the marginal price.

Generation structure in the minimum and maximum price hours of the day-ahead market

Prices in Europe have reached their lowest levels in the past four years. Spain recorded the third-lowest electricity prices in Europe in 2024, behind Nord Pool and France. The country registered the lowest prices from February to April, months characterised by high renewable generation and strong reserves.

The lowest average annual price, of €36.09/MWh, corresponded to the Nord Pool market. Among the analysed countries, prices ranged from €58.02/MWh in France to €108.52/MWh in Italy, the only country exceeding €90/MWh.

All prices were lower than last year. Italy saw the smallest variation (14.7%), while France recorded the largest drop (40.1%).

European market prices