Over the past decade, European electricity demand has declined due to decreased industrial activity and slower economic growth. While early indicators suggest that AI data centers will boost demand, mirroring trends seen in the U.S., overall electricity usage in Europe has continued to fall. However, while overall demand is falling, the surge in renewables is altering load profiles, leading to attractive opportunities for energy storage investment.
As shown in the graphic below, several countries have experienced seasonal load growth over the past decade, with Ireland leading the region due to a rapid expansion of data centers and the Netherlands seeing growth driven by industrial end-users. However, these increases only affect areas that account for about a quarter of total European load. For the majority of the region, declines have remained consistent.
While electricity demand in Europe’s largest countries has declined over the past decade, investment in renewables has surged. During this same period, wind and utility-scale solar capacity have more than doubled. This growth in solar generation in particular has significantly reduced afternoon net loads (total load minus renewable generation). As illustrated by Spain’s evolving net load curve below, the impact over the last decade has been pronounced, with July noon net loads dropping more than 19 GW.
Evening ramps (the sharp increase in net load as the sun sets) can place significant stress on the grid, as fast-acting, dispatchable generation is needed to manage the change. Spain has experienced the largest increase in evening ramps, rising from 1.5 GW in 2015 to an expected 14.1 GW in July 2025. However, Spain is not the only country facing this challenge; many others must also adapt to growing ramp rates. The chart below illustrates how July evening ramps have evolved by country over the past decade, while the table shows average evening ramps for July 2025.
Many of the countries experiencing the largest increases in ramp rates are also those with the greatest declines in overall load. This creates contradictory market forces: while reduced demand means less need for costly thermal plants, rising net load necessitates fast-acting, dispatchable generation.
Against this backdrop, the role of energy storage in Europe is becoming increasingly pivotal. Battery storage, though currently a small part of the overall capacity mix at 16.5 GW, is the fastest-growing segment, and ongoing market reforms, like the move to a 15-minute day-ahead market, are set to further accelerate its development. As these trends converge, how the market balances reliability, flexibility, and growth remains an open question, shaping an evolving landscape with new opportunities.
Be sure to check back soon for more FactSet Energy Insights on European power market dynamics and other global energy topics.
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