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Europe power supply: 2019 in review

Gas booms at coal’s expense as wind and solar tops 20% of supply

1 minute read

Using data from our Power Data Pack, the insight reviews the development of power supply in Europe’s largest electricity markets – Germany, France, Italy, Iberia (Spain & Portugal) and the UK – comparing volumes and flows from 2018 & 2019. Unless otherwise stated, all quoted changes are expressed on a year-on-year basis.

The central theme across the major markets was the prevalence of fuel-switching, driven by favourable gas economics, higher European emission allowance costs and pressure from climate policy. Total coal (hard coal and lignite) generation in 2019 was down 36% whilst gas was up 12%.

Supply from wind and solar increased by 13% and 10% respectively, and when combined accounted for just over a fifth of total supply (20%). With continued growth in capacity, Europe’s 5 largest markets produced more power from wind than coal for the first time.

Power demand was down 1.6% – with notable declines in Spain and Germany – and mild weather reduced the requirement for carbon-intensive forms of power generation in the supply mix. After gaining momentum at the end of 2018, the European emission allowance price remained high and fairly stable throughout 2019.

Despite a 5% increase in Spain, nuclear power was down 3.5% on the whole. UK nuclear struggled the most, down 9 TWh (-14%) as long-term outages persisted.

A challenging year for hydro on the Iberian peninsular dragged total production from the source across all markets down by (-8%), although heavy rainfall in November & December gave reserves a late boost. Production in Germany and Italy was stronger throughout the year, increasing by 16% & 1.5% on 2018 respectively.

The release of draft 10-year National Energy & Climate Plans (NECPs) provided opportunity to digest and scrutinise the ambitions, policies and targets of individual EU member states.

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The full insight is available as part of Wood Mackenzie Power & Renewables’ Europe Power & Renewables Service.