Market Report 2024

Germany becomes a net importer of electricity

Falling wholesale prices, weak demand, nuclear phase-out - 2023 was another turbulent year on the electricity market. Renewable energies continued to grow.

2023 - another exceptional year? The unrest on the energy markets triggered by the Russian invasion of Ukraine - along with its consequences in the form of state intervention - has subsided. Last year, changes came more from within, as the Amprion market report 2024 shows: In April, the last three nuclear power plants in Germany were shut down, electricity consumption fell and electricity imports increased significantly. For the first time in 21 years, Germany became a net importer of electricity. At the same time, electricity generation from renewable energies increased. In combination, these factors led to an overproportionate increase in the relative share of renewable energies in domestic electricity generation in Germany from 47% in 2022 to 58% in 2023.

WHOLESALE PRICES FELL SIGNIFICANTLY

Besides the structural changes in electricity generation, wholesale prices for electricity, hard coal and natural gas fell in 2023: the average day-ahead electricity price in Germany was around 102 €/MWh in 2023, compared to 236 €/MWh in 2022. This fall in prices contributed to the costs for congestion management in Germany falling from around 4 billion € in 2022 to 3.3 billion € in 2023.

The completion of the major "Enlag2" project (Energy Line Expansion Act Project 2) last year should also be mentioned in this context. The commissioning of this new transmission line by Amprion and TenneT Deutschland led to a significant reduction in grid congestions and the associated costs.

Records in the expansion of renewable energies

While domestic electricity generation in Germany declined overall last year, electricity generation from renewable energies increased: In 2023, more than 14 GW of photovoltaics and 3 GW of wind power were installed in Germany. This was accompanied by an increase in renewable electricity generation from around 242 TWh in 2022 to around 260 TWh in 2023.

More renewables, more storage, more grids

This is by no means the end of the expansion of renewable energies: the current network development plan shows that the installed capacity of renewable energies must quadruple by 2045 in order to achieve a climate-neutral electricity supply. Storage technologies are also essential. In terms of grid expansion, this means that a further 7,400 km of grid reinforcement and expansion measures will be required compared to the previous network development plan (2021).

WEBINAR

“Increasing Transmission Capacity as a Key for the European Energy Transition”

Amprion published the market report on 22 May 2024 and presented the key findings in a webinar. The webinar slides are available here soon.

CONTACT

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