Hungary remained one of Southeast Europe’s most expensive electricity markets in Week 34, as a sharp increase in thermal generation coincided with a substantial rise in net electricity imports. The combination points to supply-side economics, rather than stronger demand, as the main factor behind the country’s elevated wholesale prices.
The Hungarian day-ahead market averaged €155.16/MWh between 17 and 23 August, representing a 7.2% increase from Week 33. Only Italy recorded a higher weekly average among the monitored markets. Hungary also maintained a significant price premium over neighbouring Serbia, with the Serbian market trading approximately €22/MWh lower during the same period.
Hungary’s generation mix changed considerably compared with Week 30. Total thermal generation increased by 149.48%, with higher gas-fired generation accounting for much of the increase. At the same time, Hungary’s net electricity imports surged by 139.08%, indicating that domestic production alone was insufficient to meet the market’s requirements without substantially greater reliance on external supply.
The combination is significant because both sources of additional supply remained exposed to elevated costs. Imported electricity was drawn from a regional market that was itself experiencing tighter conditions, while European gas prices remained elevated and approached their highest levels since early 2023.
Hydropower provided little relief. Hungarian hydro generation declined by 11.92% compared with Week 30, although the decrease came from an already limited base. This left the country with relatively few domestic low-marginal-cost and flexible resources capable of responding quickly when renewable production changed or evening demand increased.
The price premium therefore cannot be attributed to stronger electricity consumption. Hungarian demand actually declined by 0.48% compared with Week 30. Instead, Week 34 points to the cost, availability and composition of the supply stack as the more important factors behind the country’s elevated wholesale prices.
Hungary’s position is also significant for neighbouring electricity markets. Its relatively high prices create an incentive to draw electricity from lower-priced systems whenever sufficient cross-border transmission capacity is available. Serbia was particularly notable during Week 34, maintaining a sizeable discount to Hungary and creating a clear price signal for potential northbound flows.
This makes Hungary an important high-value destination within the regional electricity trading system. When gas prices are elevated and domestic low-cost flexibility is limited, the Hungarian premium can widen rapidly, increasing the value of available imports from neighbouring markets.
Week 34 therefore demonstrates that high wholesale prices do not necessarily require strong demand growth. Hungary’s demand was broadly stable, yet thermal generation and imports increased sharply, reflecting the cost and availability of the marginal supply needed to balance the market.
For regional traders, the Hungarian market remains an important reference point for cross-border price formation. Its combination of elevated gas exposure, limited hydro flexibility and rising import dependence can create significant spreads with lower-priced neighbouring markets, particularly when transmission capacity is available during the region’s highest-value hours.
