Electricity Trade in Europe: Unveiling the Importer and Exporter Champions
In a world facing escalating geopolitical challenges and an urgent climate crisis, the European Union is taking bold steps to strengthen energy cooperation among its member states. The EU's vision is clear: by uniting as one, it can enhance its electricity supply security and seamlessly integrate renewable energy sources into its markets. This is according to the European Commission.
The International Energy Agency (IEA) reports a significant surge in electricity trade within European OECD countries over the last two decades. But who are the top importers and exporters of electricity in Europe? And how does this impact the continent's energy landscape?
The Importer-Exporter Divide: A Snapshot of Europe's Electricity Trade
In 2024, among the 35 European countries, 13 were net exporters of electricity, while a notable 21 were net importers. Interestingly, only Cyprus reported no electricity imports.
Dependence on Electricity Imports: Unraveling the Numbers
To understand a country's reliance on electricity imports, we examine 'net imports as a percentage of total electricity use'. A positive rate indicates a country imports more electricity than it exports, while a negative figure reveals it exports more than it imports.
In 2024, the average 'net imports as a percentage of electricity available for final consumption' across the 35 countries was -0.5% in the EU. This suggests, on average, EU countries export more electricity than they import.
Leading the Pack: Sweden and France's Net Export Dominance
Several countries boast impressive net electricity exports, surpassing their imports. Sweden takes the lead with a strong -27%, closely followed by France at -22%. Slovenia (-19%), Norway (-14%), Slovakia (-13%), Czechia (-12%), and Austria (-10%) are also prominent electricity exporters.
Among the EU's four largest economies, France (-22%) and Spain (-4%) are net exporters, while Germany (6%) and Italy (18%) are net importers. Professor Jacques Percebois, emeritus at the University of Montpellier, highlights that net exporting countries often have significant hydroelectric production, as seen in Sweden and Norway, or a substantial nuclear fleet, like France and Sweden.
On the other hand, net importing countries tend to have a high proportion of intermittent renewables, relying on imports when there is no wind or sun.
Yearly Fluctuations: A Dynamic Picture
The figures can vary significantly from one year to the next. For instance, Greece shifted from being a net importer with a rate of 10% in 2023 to becoming a net exporter in 2024 with a -0.6% total. Similarly, Croatia's net import rate soared from 10% to 26% over the same period.
Experts attribute these fluctuations to the energy mix and patterns of electricity use. John Springford, associate fellow at the Centre for European Reform (CER), explains that countries relying on gas to set electricity prices tend to import more electricity. "Countries where gas is more often the marginal producer will be bigger net importers. As the price of gas is higher, and they use gas more often, these countries will find that they import more from lower-priced plants abroad," he said.
Rina Bohle Zeller, programme lead for EU energy policy at Agora Energiewende, notes that Germany, a net electricity exporter for two decades, became a net importer in 2023, a trend that continued into 2024. This shift is attributed to higher carbon prices, making German coal less competitive on the European market, and the retirement of three nuclear reactors, Zeller explains.
She adds that the renewable energy buildout in neighboring countries has also increased low-cost supply.
Net Volume: Italy Leads as the Largest Importer
When examining the net volume of electricity trade, we find two major economies on opposite sides. Italy takes the lead as the largest net importer, with 51,000 GWh, followed by Germany with 26,269 GWh. In contrast, France emerges as the largest net exporter of electricity in absolute values, with 89,851 GWh, closely followed by Sweden with 33,435 GWh.
"France became the world's largest electricity exporter in 2024 with net electricity exports amounting to a record 90 TWh, corresponding to more than Belgium's annual electricity consumption," Zeller said. This surge was primarily driven by the rebound of nuclear output and a 10% increase in renewables generation.
The Power of Cross-Border Trade: Denmark's Wind and Germany's Sun
"Cross-border electricity trade is a cornerstone of Europe's energy system. These exchanges make electricity more affordable for European households and industry, while also being the most cost-effective way to guarantee supply security," Zeller said. It also facilitates the integration of variable renewable energy, whose output fluctuates with the weather, thereby reducing power sector emissions, she adds.
"For example, wind power generation in Denmark can pick up when Germany's solar production decreases in the evening," she explained.
As Europe navigates its energy future, the dynamics of electricity trade will continue to shape its energy landscape. With the right policies and cooperation, the EU can ensure a secure and sustainable energy supply for its citizens.
