Europe’s Electricity ‘Flash Chaos’ Highlights Market Weakness
A computer failure led to power prices spiking by 3,000% in Germany. Regulators need to pay more attention.
Together in electric nightmares.
Photographer: Loic Venance/AFP/Getty Images
Uwe Reinecke couldn’t believe his eyes. The German industrialist, who runs a steel plant near Dresden, saw the cost of electricity surge to the highest he’d ever witnessed. Just after sunrise on June 25, the cost of power in the wholesale market climbed 3,000% above typical levels – higher than anything seen even during the worst of the 2021-2022 European energy crisis. Reinecke, who has decades of experience, took an unprecedented decision: He shut down his factory.
Arguably, it was the most dramatic impact of 24 hours of turmoil in the European electricity market; a sort of flash crash that sent prices simultaneously spiking in Germany and crashing in France in just a few minutes.