Wholesale Electricity Prices

The day-ahead price is determined in a daily auction held at 12:00 CET. Power producers (solar farms, wind parks, nuclear plants, gas turbines) submit offers to sell electricity for each hour of the next day. Buyers (utilities, large industrial consumers) submit bids to buy. The exchange algorithm matches supply and demand for each hour, setting 24 hourly prices. The result: tomorrow's electricity price is already known today. This is the most important price signal in European electricity markets.

Negative prices mean producers PAY to feed electricity into the grid — this sounds counterintuitive but happens regularly. The main cause: on sunny, windy days, renewable energy (which has near-zero marginal cost) produces more electricity than needed. Nuclear and coal plants can't shut down quickly, so they accept negative prices rather than face expensive shutdowns and restarts. In Germany, there were over 300 hours of negative prices in 2023. For consumers with dynamic tariffs, negative prices can mean getting paid to consume electricity.

The wholesale price is just one component of your final electricity bill. A typical household bill breaks down roughly as: 1) Wholesale energy cost: 30–40% — this is what you see on this page. 2) Network charges: 20–30% — for maintaining the power grid. 3) Taxes and levies: 30–50% — VAT, renewable energy surcharges, electricity tax, concession fees. For example, when the wholesale price is 80 EUR/MWh (8 ct/kWh), the household price including all charges is typically 25–40 ct/kWh depending on the country.