After weeks of relatively calm conditions, a return to windy weather should lower Europe’s soaring energy prices. Wind turbines in the UK and Germany are forecast to once again operate at full capacity; this, in turn, should reduce demand for gas and lower prices.
Europe has been hit by a steep rise in energy prices as demand for natural gas has outstripped supply and renewable energy sources – wind turbines in particular – have been under-performing, unable to make up the shortfall.
The price per megawatt-hour (MWh) of gas dropped by 3.7% on Tuesday morning to €90.49 on the Dutch market. The previous week it had been at over €100 and at the start of October reached an all-time peak of €160/MWh.
Record prices have contributed to shortages of some products on the continent as global supply chains are interrupted. Furthermore, the end of summer and colder weather that autumn and winter bring has made it necessary for financial aid to be provided to more precarious households.
Numerous European businesses have reduced production in response to rising prices. This threatens to cause further damage to economies still struggling to recover from the effects of the pandemic.