Average wholesale electricity prices in 2025 rose year-on-year in multiple regions and countries, including Europe and the United States, while others such as India and Australia saw lower prices compared to 2024. Looking at electricity prices for energy-intensive industries, significant variations across regions remain. EU electricity prices for energy‑intensive industries stayed elevated in 2025, again averaging over twice US levels and nearly 50% above those in China, similar to 2024, adding competitive pressure.

At the same time, negative wholesale electricity prices became more common across many markets. Exceptions include the Nordic region in Europe and California in the United States, which recorded year-on-year declines in the numbers of negatively priced hours in 2025. These reductions were driven by more price‑responsive supply and demand, alongside the growing deployment of battery storage, which helped absorb excess generation and smooth short‑term imbalances.

Affordability remains a concern, as household electricity prices in many countries have risen faster than incomes and inflation since 2019. While energy‑related price components have fallen from crisis highs, they remain above 2019 levels, and non‑energy charges – such as networks, taxes and fees – continue to take up a large share of bills. Electricity is also often taxed more heavily than natural gas, raising its relative cost and weakening incentives for households to electrify heating, cooking and hot water. As a result, policy makers are increasingly focusing on market and regulatory reforms to improve affordability while still ensuring prices reflect costs and encourage demand‑side flexibility.

In many markets wholesale prices increased year-on-year in 2025 amid higher gas prices, following declines in 2024 compared to 2023. The average EU wholesale price in 2025 was up around 10% y-o-y to about USD 95/MWh, in line with the 9% increase in the Title Transfer Facility (TTF) natural gas price at the trading hub in the Netherlands. This was also supported by higher EU Emissions Trading System (EU-ETS) prices, which rose by 15% y‑o‑y, averaging around EUR 75/t CO2 in 2025. Average EU wholesale electricity price remained the highest among the markets analysed in 2025 – roughly twice that of the United States and India, and markedly above levels in Australia (+65%) and Japan (+25%). Cold snaps in January 2026 boosted heating and electricity demand, contributing to higher natural gas spot and forward prices. Higher gas prices, in turn, put upward pressure on power futures. EU futures prices as of 26 January 2026 averaged around USD 95/MWh for 2026, broadly in line with 2025 levels, before easing to roughly USD 85/MWh in 2027.

The occurrence of negative wholesale electricity markets continued to increase in many markets in 2025, though some diverging regional trends were observed. Negative prices broadly signal a lack of flexibility in the system due to technical, regulatory or contractual reasons, particularly during times of low electricity demand and abundant electricity generation. Negative prices are a market signal indicating a need for more flexibility. A comprehensive analysis on the reasons behind rising occurrence of negative prices can be found in a dedicated section in our Electricity 2025 report.

Many European markets continued to see more frequent negative prices, with the proportion of hours with negative prices reaching 6% in 2025 in countries such as France, Germany, the Netherlands, and Spain – compared to around 3-5% in 2024. Spain recorded the largest year‑on‑year increase, with the number of negatively priced hours doubling. This was followed by France, where these hours rose by 45% y-o-y, while in Germany and the Netherlands they were each about 25% higher.

The frequency of negative prices continued to rise in some Australian regions, such as South Australia and Victoria. This was largely due to increases in wind generation, particularly during the night. AEMO also reported that during negative price events in Australia’s NEM in 2025, prices were closer to AUD 0 /MWh on average amid lower prices for largescale green certificates.

Several regions saw a reversal of the trend of increasing negative prices. In Europe, Finland had the highest number of negatively priced hours in 2024 at 8% of the time, followed by Sweden with 7%. In 2025, both countries observed a significant drop in negative pricing, with the number of hours declining by about 40% in Finland and by almost 30% in Sweden. This may be due to a range of structural factors, including the introduction of flow-based market coupling used for calculating and allocating cross-border electricity trading capacity, growth in storage, and generation becoming more price-responsive. In addition, this may be driven by Finland’s continued electrification of district heating, up around 70%, from 1.5 TWh in 2024 to 2.6 TWh in 2025, which can be price responsive.

In the United States, California and Texas also recorded declines in the frequency of negative price events. This shift may be linked to rising electricity demand and, in particular, to the rapid expansion of battery energy storage systems in both states − reflected in the marked increase in average hourly battery charging around midday.

In 2025, electricity prices for energy-intensive industries remained broadly stable across our tracked regions compared to the previous year. However, regional differences persist. In the European Union, after two years of significant declines since their 2022 peak, prices for energy-intensive industries in 2025 continued to be on average roughly double the prices in the United States and more than 50% higher than in China and India.

Electricity prices for residential consumers have been subject to significant variations across regions in the last five years, as geopolitical events, wholesale market trends, rising network costs, and relief measures drove high volatility. Record level prices were observed between 2022 and 2024 in markets such as the European Union, the United Kingdom, Japan and Korea. Although prices have since retreated from their peaks, they remain elevated in many countries, affecting affordability and posing a risk to the expansion of electrification of end uses such as space cooling and water heating.

The rise in electricity prices for households has outpaced growth in income and general inflation rates since 2019 in many countries, leading to costlier bills for residential consumers. Between 2019 and 2024, electricity prices for households increased by 36% on average in the European Union and by 26% in the United States. During the same period, annual net earnings for a two-earner couple with two children increased by 25% in the European Union, and by 23% in the United States, while inflation rates during this period were 22% and 23%, respectively.

Household demand for electricity is generally price-inelastic, meaning it responds only modestly to variations in retail prices given the essential nature of many end uses (like lighting, refrigeration, cooking, electronic devices). Therefore, increases in prices tend to translate into higher household expenditure on electricity, especially in the short term.