European solar energy hits 10.75% of the EU power mix in March 2025, helping cut prices amid record photovoltaic output and mild weather
European solar energy sets new record in March 2025
Solar power reached a new milestone in March 2025, supplying 10.75% of the European Union’s electricity mix. According to data from Eurelectric, solar photovoltaics generated 24.1 TWh across the EU, marking a nearly 4-point increase from February and standing out as one of the highest shares ever recorded for March.
This surge is partly due to favorable weather conditions, but it’s also a result of the EU’s rapidly expanding solar capacity. In just one year, the 27 member states collectively added 64 GW of new photovoltaic power.
The growth of solar has boosted the overall share of renewables across the continent. Eurelectric reports that the share of renewables in the energy mix was 15% higher in March compared to February, although slightly lower (1%) than in March 2024.
Solar power’s impact on energy prices
“European solar energy came to the rescue of high electricity prices this March,” noted the industry association, “thanks to sunnier days and increased installed capacity.”
The combination of strong solar output, improved nuclear generation, and milder temperatures helped bring electricity prices down to €90 per megawatt-hour (MWh), a significant drop from €126/MWh in February and €112/MWh in January.
The downward pressure from renewables on energy prices was also highlighted in recent findings by the Italian Renewable Energy Observatory, particularly regarding Italy’s power market.
Renewables and the day-ahead market price
In 2024, the average price of electricity on Italy’s day-ahead market fell by 18%, from €127.4/MWh in 2023 to €108.5/MWh. This decline is partly attributed to the growing share of clean energy generation.
In today’s electricity markets, where prices are based on the system marginal price model, increased wind and solar production – technologies with near-zero marginal costs – naturally leads to lower prices.
This effect is clearly shown in the chart below, where each bar represents the average hourly electricity price (€/MWh) corresponding to different levels of renewable energy output.
The red line in the chart represents the average electricity price (PUN) in 2024 – €108.5/MWh – on the Italian power exchange managed by GME. The difference between this yearly average and the hourly PUN across different levels of renewable generation clearly decreases as more clean electricity enters the grid.
This trend, known as the merit order effect, highlights how an increasing share of renewable energy consistently drives down electricity prices. As renewables – especially wind and solar – have near-zero marginal costs, their priority in the dispatch order helps push more expensive fossil fuels out of the market, lowering the overall price of power.
