Thermal generation regained short-term system value in SEE during Week 25. Regional thermal output rose 19.4% to 5.31 TWh, with gas-fired generation surging 32.3% and lignite and coal output rising by 4.5%. This was not a return to old baseload economics. It was a flexibility response to a tighter hourly power balance.
The rise in thermal generation came despite lower gas prices. TTF futures fell by 14.8%, but electricity systems still needed more dispatchable output because demand increased, wind weakened and hydro declined in key markets. Thermal plants filled the gap during the hours when renewable output was insufficient.
Italy was the most visible example. Its total thermal generation jumped by 66.7%, gas-fired production rose by more than 61%, and coal generation almost quadrupled. That increase was driven by lower hydro, weaker wind and sustained demand. Italy’s price remained the highest in the region at €127.69/MWh, confirming that thermal dispatch was responding to scarcity rather than suppressing prices.
Hungary and Croatia also increased thermal generation, mainly through gas-fired output. Greece recorded no lignite generation, but gas-fired production rose by 16.4%, enough to lift total thermal output by 5.4%. Türkiye shifted from gas toward coal while keeping total thermal generation broadly unchanged.
For policymakers, this week is a reminder that thermal capacity still provides adequacy and ramping value during the transition. The strategic question is not whether thermal plants run all the time, but whether they are available when solar falls, wind weakens and hydro is constrained.
For investors, the revenue model is changing. Thermal assets will increasingly earn value from scarcity hours, capacity mechanisms, balancing services and flexibility rather than continuous generation. That creates a different risk profile, especially for gas-fired plants that must manage fuel price exposure, carbon cost and operating-hour uncertainty.
For SEE power markets, Week 25 showed that renewables and thermal generation are not yet substitutes in every hour. Renewables provide low-cost energy. Thermal plants still provide firm response. The region’s price formation will remain shaped by that interaction until storage, demand flexibility and grid capacity expand materially.