Heat, Gas and Nuclear Strain Push European Power Prices Higher in August

Wholesale electricity prices across Europe climbed sharply in August 2026, driven by a combination of summer heat, surging gas costs, and constrained generation from both renewables and nuclear plants, according to data from the Ember analytics centre.

Day-ahead prices rose across all major markets compared with July. France recorded a 30 percent jump to €125.6 per megawatt-hour, while Sweden was up nearly 30 percent at €59.6/MWh. Germany reached €126.1/MWh, an 18 percent increase, and Italy topped the continent at €179.2/MWh, up 14.3 percent on the month.

A key driver was the TTF natural gas benchmark, which averaged €62.14/MWh in August — the highest monthly figure since February 2023 and roughly 90 percent above year-ago levels. Analysts point to depleted European storage and heightened tensions around the Strait of Hormuz as the main causes. Carbon permit futures also climbed, averaging €82.37 per tonne, twelve percent higher than a year earlier.

The heatwave simultaneously exposed structural weaknesses in the region’s nuclear fleet. Reactors in France and Hungary curtailed output as river temperatures rose and water levels fell. Romania was forced to take its Cernavodă nuclear plant entirely offline after the Danube dropped too low for adequate cooling.

The European Commission used the episode to reiterate the case for expanding domestic low-carbon generation and accelerating electrification. Ukraine’s own day-ahead market reflected the regional trend, with average prices rising 32.9 percent month-on-month to €119.4/MWh. Separately, Ukrainian lawmakers approved a renewable energy support bill tied to the Ukraine Facility programme.

Source: GMK Center / Ember