Methodology: Understanding Electricity Prices
Learn how electricity exchange prices are calculated, what factors affect them, and how our platform processes this data.
Data Source
We show day-ahead auction prices from EPEX SPOT, the leading European power exchange. EPEX SPOT runs the daily auction where electricity is bought and sold for the next day. Germany and Luxembourg form one price zone (DE-LU bidding zone) with the same prices.
How Prices Are Set
Every day at 12:00 CET, EPEX SPOT closes the day-ahead auction. Power plants offer electricity at their costs. Retailers bid for what they need. The EUPHEMIA algorithm calculates where supply meets demand. By 12:57 CET, final prices are published for all 24 hours of the next day. This happens 365 days a year.
Merit Order: Cheapest First
The electricity market uses merit-order principle. Cheapest power plants run first. Wind and solar cost almost nothing to run (no fuel needed), so they go first. Then coal plants. Gas plants are most expensive, so they run last. The most expensive plant needed to meet demand sets the price for that hour. This is why windy or sunny days have lower prices.
Germany + Luxembourg = One Price Zone
Germany and Luxembourg share one electricity price zone called DE-LU bidding zone. All areas get the same wholesale price each hour. Neighboring countries like France or Poland may have different prices if transmission lines are full. Our chart shows the official DE-LU zone prices from EPEX SPOT.
Renewables Drive Price Changes
In 2024, renewables provided about 60% of German electricity. When wind blows or sun shines, cheap renewable energy floods the market and prices drop. Sometimes there is too much renewable power and prices go negative (about 5% of hours in 2024). When renewables are low, expensive gas plants must run and prices spike. This is why prices change every hour.
Your Bill: Wholesale Price + Fees + Taxes
Our chart shows wholesale day-ahead price (cost of electricity itself). Your final bill has three parts: 1) Wholesale price (average €78/MWh or ~7.8 cents/kWh in 2024), 2) Network fees (for power lines and infrastructure), 3) Taxes and levies (VAT, renewable surcharge). The wholesale price changes hourly. Network fees and taxes are mostly fixed. Saving during cheap hours reduces the wholesale portion.
When Are Prices Published?
EPEX SPOT auction closes at 12:00 CET daily. Preliminary results come at 12:45 CET. Final prices are published by 12:57 CET. We fetch them and show on our chart. Starting September 30, 2025, day-ahead markets also use 15-minute intervals (MTU) for more precise pricing. Check our chart after 1 PM to plan tomorrow's electricity use.