The cost of gas-fired power in the EU jumped by more than 50% since the escalation of conflict in the Middle East

Brussels, 13 March 2026 – Analysis from think tank Ember shows the cost of gas-fired power in the EU increased by more than 50% in the first ten days of the conflict since 28 February.

Disruption to global fossil fuel supplies following strikes by Israel and the US on Iran have had an immediate impact on international oil and gas prices. European gas prices (Dutch TTF) averaged €45/MWh in the first week of the conflict (2-6 March), an increase of nearly 50% compared to pre-conflict levels (€31/MWh), pushing up the cost of gas-fired power.

As prices jumped, the EU paid an additional €2.5bn for fossil fuel imports in the first ten days of the conflict.

“Once again global conflict has sent gas prices soaring. Import-dependent regions could see dramatic economic consequences,” said Ember analyst Dr. Chris Rosslowe. “Clean power paired with electrification is the only way to shield against sudden gas and power price hikes in this and future crises.”

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Some EU countries are more exposed to gas price impacts than others

Typically gas is the most expensive form of power generation, and as such, often sets the price for electricity. However, the impact of soaring gas prices on electricity costs will be felt most strongly where there is a higher reliance on gas for electricity production and power system flexibility.

Spain has achieved a structural decoupling between gas and power prices in its market, amid rapid wind and solar growth since 2019. In 2026 so far, gas influenced the price of electricity in Spain in only 15% of hours. In Italy it was 89%, as it remains highly dependent on gas for power and flexibility. In the first ten days of the conflict, average power prices in Spain remained below the cost of gas-fired power, and lower than other EU countries with large gas power fleets.

While it is too early to see the full impact of the gas price increase on electricity costs, price volatility increased in March, particularly in the gas-heavy morning and early evening hours. In the first week of March, power prices rose to their highest levels of the year in Germany, Netherlands, Italy and Belgium. Less gas-reliant countries such as Spain, Portugal, France and the Nordics appear less impacted.

Once again global conflict has sent gas prices soaring. Import-dependent regions could see dramatic economic consequences. Clean power paired with electrification is the only way to shield against sudden gas and power price hikes in this and future crises.

Dr. Chris Rosslowe
‍Energy Analyst, Ember

Knee-jerk electricity market reforms won’t solve the fundamental issue of gas reliance. Removing carbon costs would remove an incentive to invest in the true solution to price shocks: renewables, batteries, demand flexibility and electrification.

Dr. Chris Rosslowe
‍Energy Analyst, Ember

Gas price spikes put EU ETS costs into perspective

The jump in gas costs adds twice as much to gas-fired power costs as the cost of carbon due to the EU Emissions Trading Scheme. This comes as Italy has pushed for changes to the ETS, to be discussed at next week’s European Council meeting on 19th-20th March.

At current gas prices, the carbon cost constitutes at most around 10% of the average EU household electricity bill, less than the average rate of VAT (18%).

“Knee-jerk electricity market reforms won’t solve the fundamental issue of gas reliance,” continued Dr. Rosslowe, “Removing carbon costs would remove an incentive to invest in the true solution to price shocks: renewables, batteries, demand flexibility and electrification.”

About Ember

Ember is an independent energy think tank that aims to accelerate the clean energy transition with data and policy. It creates targeted data insights to advance policies that urgently shift the world to a clean, electrified energy future.

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