Switched On European Power Confronts Gas Shock: Analyst Reaction
Mar 24, 2026
Kesavarthiniy Savarimuthu, Head of European Power at BloombergNEF, offers expert analysis of Europe's energy landscape. She discusses current power price dynamics and why gas still matters more than oil. She explores how renewables and falling demand have bolstered resilience. She outlines coal's temporary role as Europe shifts toward lower-carbon grids.
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Current European Power Prices Are Far Below 2022 Peaks
- Northwest European power is trading around €92 per megawatt hour now with winter contracts near €140/MWh.
- Those levels are far below the ~€1,000/MWh spikes seen in the 2022 crisis, showing current resilience.
2022 Was A Perfect Storm Of Multiple Energy Failures
- The 2022 price shock was a perfect storm: Russia cut pipeline gas, French nuclear outages reduced exports, and drought reduced hydropower.
- Those simultaneous supply shocks forced neighboring markets to burn more gas, driving extreme price spikes.
Renewables Have Cut Gas's Price-Setting Role
- Europe's wind and solar fleet has more than doubled to ~650 GW, reducing gas's role in power generation.
- BNEF expects ~1,000 GW of wind and solar by 2030, increasing resilience to gas shocks by lowering gas price pass-through.