Author: PPD Team Date: 28/02/2025
Photovoltaics (PV) and wind now dominate Europe’s power generation, surpassing fossil fuels, according to the latest Enervis report. However, increasing cannibalization of renewable energy is reducing market revenues for solar and wind power producers.
Cannibalization occurs when high solar and wind generation floods the electricity market, driving down prices, sometimes even turning negative. In 2024, this effect was particularly strong in Germany, where PV capture rates dropped to just 59%, the lowest in Europe. In contrast, the United Kingdom, Italy, and Finland had the highest capture rates, ranging from 86% to 90%.
Cross-border cannibalization is also growing, especially in Southeastern Europe. Surplus solar power from high-generation countries like Germany is exported to Austria, the Czech Republic, Slovakia, Hungary, and Romania, reducing prices and cutting revenues for producers in those markets.
Despite still-elevated baseload prices in 2024, PV cannibalization led to a capture price of just €47 ($48.83)/MWh for German solar producers, among the lowest in Europe. The Netherlands and Germany recorded the highest number of negative price hours, while Spain experienced them for the first time.
Enervis projects 390 GW of new renewable capacity between 2025 and 2030 but only 93 GW of additional storage, lagging behind PV and wind deployment. Without sufficient grid flexibility and energy storage, price volatility is expected to increase, making flexibility solutions economically valuable in the medium term.