Energy production from renewable sources continued to rise in the European Union in 2025, with solar energy reaching a new all-time high, according to a European Commission announcement published on Monday.

The announcement covers the latest quarterly reports on the electricity and natural gas markets, which cover the third and fourth quarters of 2025 and complete the picture of the state of the EU’s energy markets for the entire year.

According to the Commission, solar energy production in the EU reached 275 TWh in 2025, marking an 18% increase. Energy production from offshore wind farms increased by 4%, or 3 TWh.

New renewable energy installations remained at record levels in 2025, approaching 70 GW of new capacity. The majority of new installations were in solar energy, with 56 GW of new installed capacity. Wind power, from onshore and offshore farms, increased by 13 GW.

The European Commission also reports that 2.89 million new electric vehicles were sold in the EU in 2025, a 31% increase compared to 2024. According to the announcement, annual sales of electric vehicles have nearly tripled since 2019, recording a 177% increase.

In the fourth quarter of 2025, electric vehicle sales accounted for 22% of the total EU market, more than double the corresponding share in the United States, which stood at 7%.

As for electricity prices, the European Electricity Reference Index averaged 85 euros per MWh in 2025. This level was 9% higher than in 2024 but remained 14% lower than in 2023.

According to the European Commission, prices varied significantly among member states, ranging from an average annual level of 41 euros per MWh in Finland to 116 euros per MWh in Italy.

Electricity consumption in the EU increased by 1% compared to 2024, mainly due to lower temperatures during the winter of 2025. Despite the increase, demand remained 2% below the average for the 2019–2022 period, according to the announcement.

In the natural gas market, the average annual wholesale price stood at 36 euros per MWh in 2025, marking a slight increase of 5% compared to the 34 euros per MWh recorded in 2024.

The European Commission notes that this trend reflects the short-term price spike at the beginning of last year, following the suspension of Russian natural gas exports via pipelines passing through Ukraine. Despite the increase, the average price remained 22% lower than the 2021 level, when it stood at 47 euros per MWh.

According to the report, retail natural gas prices appear to have stabilized in 2025, averaging 109 euros per MWh.

Natural gas consumption in the EU reached 339 billion cubic meters in 2025, a 2% increase compared to 2024, when it stood at 332 billion cubic meters. The Commission notes that the increase reflects a modest recovery following the sharp decline recorded during 2022–2023, at the height of the energy crisis, however, consumption remained below 2022 levels.

According to the European Commission, the reports analyze data on the EU’s natural gas and electricity markets, examining key trends, challenges, and factors influencing fluctuations in prices and trading volumes, as well as the interaction between these factors and energy market participants.

Source: CNA