European PPA Market Records 24 July Deals as Regional Prices Pull in Opposite Directions

Europe’s long-term renewable energy contract market recorded 24 new deals totalling 1.1 GW in July, alongside nine agreements in the battery storage sector, according to data from consultancy Pexapark. The Euro Composite base index reached €45 per megawatt-hour overall, yet that headline figure conceals a clear regional split in pricing trends.

The United Kingdom and Italy pushed the aggregate index higher, with contract prices rising 5.8% and 4.3% respectively, both driven by gas market risk factors. Markets with strong renewable penetration moved in the opposite direction: Spain fell 3.9% and Portugal 2.9%, with both declines attributed largely to high renewable generation. Northern Europe recorded the steepest drop at 6.3%, driven primarily by a reassessment of fair-value pricing for Danish power purchase agreements — incorporating revised capture-price curves and updated market-risk estimates — while elevated renewable output and hydro reservoir levels added further downward pressure on forward expectations.

Corporate buyers dominated new deal activity, signing 21 contracts totalling roughly 770 MW. The month’s largest single transaction was a 332 MW agreement by Ørsted for the Gode Wind 1 offshore wind farm in Germany.

Battery energy storage attracted nine contracts totalling 865 MW. Tolling structures were prevalent, including two Zelestra agreements in Italy of 300 MW and 207 MW. The July data also showed revenue-swap arrangements in Spain and Hungary, and merchant revenue-sharing structures in Germany, Poland, and Denmark — pointing to increasingly varied contracting models emerging across the BESS segment.

Source: PV Magazine