Weathering the winter
Europe’s power system weathered a turbulent winter with the help of reduced demand combined with record renewable generation. A coal ‘comeback’ never materialised, as EU coal power fell compared to last winter.
27 Apr 2023
16 Minutes Read
Electricity
Europe
Highlights
>60%
The majority of member states reduced peak power demand by 5% or more over winter, as mandated by emergency EU legislation.
€12bn
Reductions in power demand across the EU this winter avoided €12 bn in electricity costs.
40%
With 40% share, renewables generated more EU electricity than fossil fuels in winter for the first time.
Executive summary
EU power system weathered the winter
A significant decrease in electricity demand combined with record renewable electricity supply prevented the EU from returning to fossil fuels this winter.
As the EU headed into winter 2022 with fears of gas shortages and a raging cost of living crisis, there was understandable concern over how the electricity system and consumers would cope during the coldest months. Europe’s power sector had already suffered a tumultuous year. Russia’s invasion of Ukraine pushed the cost of gas sky high, whilst low nuclear and hydropower generation further exacerbated the energy crisis. Record solar and wind growth helped plug the generation deficit but speculation continued around the EU’s ‘return to coal’.
As part of an effort to tackle the energy crisis, the EU set a voluntary electricity demand reduction target for Member States over winter. Alongside this, warmer weather and high electricity prices caused demand to drop across the EU. Due to this decrease, coal and gas generation dropped sharply year-on-year for the winter period spanning October 2022 to March 2023, generating less than renewables for the first time in winter. With fossil fuel generation down, EU power sector emissions during winter were the lowest they have ever been.
Now, with Europe successfully on the other side of this winter and major supply disruptions avoided, it is clear the threatened coal comeback did not materialise. On the contrary, spring is starting in Europe with coal generation down in six of the previous seven months, historically high gas storage levels, and industry forecasts of continued renewable growth to come.
While Europe will be glad to put a difficult winter behind it, the measures taken should be learned from to inform the accelerating transition away from fossil fuels. Demand reductions that can be maintained sustainably should be, in order to reduce strain on grid infrastructure. And demand flexibility will be a critical part of Europe’s future power system: any gains made in recent months in this much-needed service should be evaluated, consolidated, and quickly built on.
Key takeaways
01
Electricity worth €12bn saved across the EU over winter
Nearly every member state reduced electricity demand over winter, although only a handful achieved the voluntary 10% reduction target set by emergency EU legislation. Total EU electricity demand was down 6% on the five-year average, saving €12 bn worth of electricity over winter (November-March). These demand reductions contributed to security of supply, saved gas for other uses, and prevented a return of coal generation.
02
Renewables generate more power than fossil fuels over winter for first time
As fossil fuel generation dropped 12% year-on-year due to a large drop in power demand, renewables increased to overtake the share of fossil fuels in the EU electricity mix for the first time. Renewables accounted for 40% of EU generation between October and March, with fossil fuels at 37%. Coal power fell by 11% (-27 TWh) and gas by 13% (-38 TWh) compared to the previous winter.
03
Coal power fell in 15 out of 18 EU coal countries over winter
Of the 18 countries in the EU that continue to use coal for power, 15 reduced coal generation over winter 2022 compared to the same period the previous year. The only three to increase coal generation were Italy, Finland and Hungary. ‘Returning’ coal units brought ran only at an average of 27% of their full capacity over winter.
17 EU Member States reduced peak demand by 5% or more
Emergency EU legislation in October 2022 introduced a mandatory target to reduce power consumption by 5% during peak hours. Analysis of hourly data from this winter and the previous five winters reveals that the majority of member states achieved this. These actions almost certainly lowered system adequacy risks, reduced gas consumption and limited the occurrence of even more extreme price spikes.
Supporting Materials
Downloads
This web page only includes the executive summary. To read the full report, download the PDF.
Methodology
Winter definition
‘Winter’ in this piece refers to October of the stated year to March of the following year. ‘Winter 2022’ means in this case October 2022 to March 2023. Analysis of bulk and peak reduction uses the period November 2022 to March 2023 as this is the period to which the emergency EU legislation (and targets) applies.
Calculating the value of saved electricity
Electricity ‘savings’ (TWh) are defined as the difference between monthly demand this winter and the average demand for the same month over the last 5 years in each country. To calculate the value of this saved electricity, the TWh value per country is multiplied by the average day-ahead price over the month in that country.
Identification of peak hours
We identify peak hours in a way that matches as closely as possible to the definition set out in the emergency EU legislation. The legislation states that “Each Member State shall identify peak hours corresponding in total to a minimum of 10% of all hours of the period between 1 December 2022 and 31 March 2023′. ‘States shall reduce gross electricity consumption by 5% on average per hour’, where ‘peak hours’ means individual hours of the day where, based on the forecasts of transmission system operators and, where applicable, nominated electricity market operators, day-ahead wholesale electricity prices are expected to be the highest, the gross electricity consumption is expected to be the highest or the gross consumption of electricity generated from sources other than renewable sources is expected to be the highest” (p37).
As the forecasts of transmission system operators are not readily accessible, we used historical hourly data to identify the 10% of hours qualifying as peak. We were able to collect reliable hourly data for 24 member states dating back to November 2017 (hence providing a full 5 years of reference data prior to this winter). For each country, we calculated the average demand in each hour of the winter period. The ‘peak hours’ were identified as those hours in the top 10% for average demand over the reference period. Unlike the legislation, we included November in the reference period, to maintain a consistent definition of the winter period for demand analysis. The impact of including November in the peak demand analysis is not significant, as only 8% of the peak hours we identified fell in November.
Across all countries most peak hours are concentrated in January (44%) and the lowest fraction are in March (3%).
Correction note
A previous version incorrectly stated that Germany and Poland were responsible for 70% of the reduction in EU coal generation this winter, with decreases of 9 TWh and 4 TWh respectively, this was updated 27/4/23
Acknowledgements
With thanks to Agora Energiewende for providing high quality open data on the German power system. With thanks to the European Environmental Bureau for their research and tracking of energy saving measures in force across Europe.
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