Southeastern Europe is heading into the summer season with concerningly low water levels at its hydropower facilities, raising alarms about the potential for increased wholesale electricity prices in the near future. Hydropower reserves across the region are currently lower than they were at the same time last year. In Greece, for example, the available water levels represent about 2,274 GWh of electricity generation capacity, which marks a 14% decrease from the 2,645 GWh recorded in April 2024.
Experts attribute this drop to an unusually dry winter, where limited snowfall occurred despite substantial rainfall in November and December. The issue is not isolated to Greece but is affecting the entire southeastern European region. The situation could worsen if the area experiences heatwaves, as this would increase electricity demand while hydropower production is likely to continue declining.
In addition to low hydropower reserves, gas prices are expected to be higher this summer compared to the previous winter, which will add further pressure on energy costs. Hungary, in particular, could face difficulties due to its significant expansion of solar energy capacity without adequate gas-based backup. As a result, after sunset, Hungary will rely more on imported electricity. If neighboring countries experience hydropower shortages, Hungary may have to draw power from southern markets, leading to higher day-ahead electricity prices.
