Looking ahead to the electricity market in 2025: Rising prices and system limits once again

The year 2025 has shown that the energy transition in the electricity market is failing less due to a lack of new power generation and increasingly due to systemic limitations. After a period of declining prices, average electricity costs have risen again. At the same time, the expansion of renewable energies has slowed, while the demands on grids, flexibility, and controllability have increased significantly.

Although new solar and wind power capacities were connected to the grid, the share of renewable energies in the electricity mix remained almost constant. Weather effects, particularly a year with less wind, as well as increasing grid congestion, meant that additional generation could not be fully utilized. This was especially evident in the sharp increase in curtailment of solar power: renewable energy is available more and more frequently, but cannot be integrated economically.

In parallel, price signals in the electricity market have changed significantly. With the shift to a finer temporal resolution on the exchange, prices reflect supply and demand more directly. The spread between cheap and expensive hours has increased, as has the number of hours with very low or even negative electricity prices. This increases the economic incentive to shift electricity consumption and manage it flexibly.

Structural changes are also emerging in the energy storage sector. While the expansion of residential installations has declined, interest in commercial and large-scale battery storage systems continues to rise. Falling costs and numerous grid connection requests indicate that storage will play a central role in the future integration of renewable energies and the utilization of price fluctuations.

Overall, 2025 was not a year of major expansion, but rather a year of clear signals. Rising prices, increasing curtailment, and greater price fluctuations make it clear that generation alone is not enough. Intelligent procurement strategies, flexible loads, storage solutions, and active management of energy consumption will be crucial in the future. This is precisely where the leverage lies to combine economic efficiency, security of supply, and system stability.