Europe has just said goodbye to the “cleanest” Christmas in its recent history in electrical terms, but the sector’s toast has been bittersweet. While families celebrated the holidays with electricity prices at a minimum, in the offices of regulators and analysis centers a very different scenario was already being drawn for the near future.
We have the sun, we have the wind and we have broken production records, but the system shows signs of exhaustion. The success of this Christmas is, in reality, a reminder of the paradox that the continent is experiencing: we have never produced so much clean energy and, yet, the specter of gas, the saturation of the networks and an imminent rise in regulated costs threaten to spoil the party from 2026.
The milestones of December. The fourth week of December 2025 will be recorded as an oasis of low prices. According to data from AleaSoft Energy Forecastingthe prices of the main European electricity markets fell significantly, with weekly averages below €85/MWh. In the Iberian Peninsula, the MIBEL market led this trend with a drop of 20%, the largest percentage decrease on the continent.
This phenomenon, dubbed by analysts as the “Christmas effect”, is due to the combination of lower demand due to the festive break and a massive increase in wind and solar production, which put downward pressure on prices across almost the entire continent.
The deployment of clean energies. As the report detailssolar photovoltaic production increased by 48% in Portugal and 21% in Spain during the week of December 22. This push was not exclusive to the peninsula: Germany, Italy and France set new historical highs for photovoltaic production for a day in December (Germany generated 87 GWh on the 25th).
For its part, wind production maintained its upward trend, rising by 80% in Italy and 21% in Spain. According to the monthly report of OMIEthis force of the wind had already been brewing since November, the month in which wind energy reached a market share of 39.7% in the Spanish system.
Abundance vs. rigidity. Despite these records, the transition faces critical obstacles: the disconnection between generation and the capacity to absorb it. According to AleaSoft forecastsAlthough solar production continues to grow, the European grid shows signs of saturation as demand falls.
The technical problem is that, at times of maximum solar production and low demand, the system has nowhere to store the surplus. This forces prices collapse non-structurallywhich in the long term puts the profitability of new investments in check. Furthermore, added to this is a fiscal anomaly since in much of Europe, electricity is still burdened with tolls and taxes that make it up to three times more expensive than gas for the end user, slowing down the adoption of efficient technologies. like heat pumps.
The Spanish case: the danger of bottlenecks. In Spain, this situation is especially delicate. The country has converted in a “case study on the dangers of saturation.” The lack of investment in networks (only 30 cents for every euro invested in renewables) has caused the curtailment —clean energy that is wasted because the grid cannot transport it—has tripled.
The example most critical is Asturias. The network in the central Asturian area is at the technical limit; No more storage projects or new industry can be connected because the cables and transformers cannot support any more load. Furthermore, to avoid blackouts, Red Eléctrica operates in “reinforced mode”activating expensive gas plants to stabilize the tension, an extra cost that ends up in the citizens’ bill.
A structural January slope. This Christmas’s price relief could be temporary. AleaSoft Energy Forecasting warns that future of CO2 have reached their highest closing prices since October 2024 (above €88/t), and TTF gas remains stressed due to low temperatures and European reserves below 65%.
And in Spain we have to add the regulatory horizon of 2026. As we have detailedthe largest simultaneous increase in fixed costs in years is expected: transport tolls will rise by 12.1% and government charges by 10.5%. There is a real risk of returning to the tariff deficit if electricity demand does not grow as much as the Government expects, which would generate new structural debt in the system.
The challenge of not dying of success. The European energy transition has shown that it can expel fossil fuels in certain days. However, this triumph has collided with an insurmountable physical reality: obsolete networks and a cost structure that still penalizes electricity.
Christmas 2025 has given us a green market, but the shadow of 2026 reminds us that it is not enough to fill the landscape with mirrors and windmills. Without a real commitment to batteries, a modernization of cables and a reform of regulated costs, the abundance of clean energy will remain a mirage that fades just before reaching our pockets.
Image | freepik
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