Regional output and fuel mix changes
Thermal generation regained short-term system value in Southeast Europe during Week 25. Regional thermal output increased 19.4% to 5.31 TWh, with gas-fired generation up 32.3%. Lignite and coal output rose by 4.5%.
The higher dispatch did not reflect a return to old baseload economics. It came as a flexibility response to a tighter hourly power balance.
Gas prices fall while dispatchable needs rise
The increase in thermal generation occurred despite lower gas prices. TTF futures fell by 14.8%, but electricity systems still required more dispatchable output as demand increased, wind weakened, and hydro declined in key markets.
Thermal plants provided additional output during hours when renewable generation was insufficient.
Country-level shifts: Italy, Greece, Türkiye
Italy showed the clearest change during the week. Total thermal generation rose by 66.7%, gas-fired production increased by more than 61%, and coal generation almost quadrupled.
The Italian increase was linked to lower hydro, weaker wind, and sustained demand. Italy’s price remained the highest in the region at €127.69/MWh, indicating thermal dispatch was responding to scarcity rather than suppressing prices.
Hungary and Croatia also raised thermal generation, mainly through gas-fired output. In Greece, there was no lignite generation, but gas-fired production climbed by 16.4%, lifting total thermal output by 5.4%.
Türkiye shifted from gas toward coal while keeping total thermal generation broadly unchanged.
Adequacy and market design implications for thermal assets
For policymakers, the week highlighted that thermal capacity still supports adequacy and ramping value during the transition period. The key question described in the data is whether plants are available when solar output falls, wind weakens, and hydro is constrained.
For investors, the revenue model is shifting toward scarcity-driven value rather than continuous generation. Thermal assets are expected to earn value from scarcity hours, capacity mechanisms, balancing services, and flexibility, which changes the risk profile for gas-fired plants due to fuel price exposure, carbon costs, and uncertainty around operating hours.
Renewables and thermal remain complementary in hourly pricing
In SEE power markets, Week 25 showed that renewables and thermal generation are not substitutes in every hour. Renewables provide low-cost energy while thermal plants provide firm response.
The interaction between those resources continued to shape regional price formation during the week until storage, demand flexibility, and grid capacity expand materially.
