Germany's uniform electricity price hinders European grid expansion

The German government maintains a uniform electricity price, which experts view as an obstacle to European energy market integration. Bernd Weber of the Epico think tank warns of delays in grid expansion. In countries like Sweden, concerns are growing about rising prices.

Germany's uniform electricity price is considered inefficient and incurs high costs. Last year alone, billions of euros were spent on balancing costs for grid operators.

Bernd Weber, head of the Epico think tank, told Handelsblatt: “The adherence to the uniform electricity price zone weakens the willingness for rapid grid expansion with Germany and threatens to become a brake on European energy market integration.”

The EU Commission has been pushing for multiple bidding zones for years. The topic has regained stronger focus in Germany in recent weeks. Sweden and other countries fear that additional connections with Germany will bring high price pressure to their own markets.

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Illustration of a heatwave in Europe driving up electricity prices to record highs.
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Electricity prices in Europe surge due to heatwave

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The ongoing heatwave is driving electricity prices in Europe to unusual highs. On Wednesday evening, power was traded for nearly 750 euros per megawatt hour.

On May 1, 2026, electricity prices on the German exchange dropped to minus 499 euros per megawatt hour. High photovoltaic production met low demand on a holiday. Economy Minister Katherina Reiche plans reforms to address this.

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The Federal Network Agency has presented cornerstones of a reform to electricity grid fees. In future electricity producers will also contribute. This affects in particular owners of photovoltaic systems.

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