Italy's Drought Cuts Thermal Output as Po Basin Awaits Late-August Rain
Cooling water shortages have curtailed generation by 3%, with up to 20 GW of thermal capacity still exposed if Po river levels fail to recover before September.
Romania shut down its last operating nuclear reactor on Thursday (2026-08-13) as the Danube fell to a 90-year low, forcing Nuclearelectrica to halt its remaining unit and underscoring how far this summer's drought has extended its reach across European power grids.7
Italy has not had to shut a reactor. But its thermal fleet is already taking real losses. Major gas plants have cut output due to cooling water shortages, pushing curtailments to around 3% of total thermal generation, analysts told Montel on Monday (2026-08-10). No significant rainfall is forecast to raise Po basin water levels before late August, meaning the constraint has time to deepen before relief arrives.6
The 3% already lost sits against a much larger ceiling. Shortages of cooling water could threaten up to 20 GW, nearly one-third of Italy's full thermal fleet, and are likely to keep spot power near the EUR 200/MWh level for as long as the drought constraints persist, an analyst told Montel on Thursday (2026-08-06).5
Those two data points, 3% actually curtailed and 32% of the fleet at risk, are measuring different things. The first is an observed loss; the second is an analyst estimate of maximum potential exposure. The distance between them is significant for traders: it is the gap between a grid running below par and one facing the kind of sustained shortfall that would require either significant import reliance or a step-change in demand response to manage through September.6,5
Italy's vulnerability here is not new. The ENTSO-E Summer Outlook, published in June 2026, identified Central Northern Italy as especially dependent on power imports when domestic renewable generation falls short — exactly the grid condition a heatwave-and-drought combination tends to produce. With hydropower also squeezed by low river flows and gas plants cutting back, the system leans on cross-border electricity flows that the rest of a drought-stressed European network is simultaneously competing for.3
ICE Endex TTF front-month gas recorded EUR 61.38/MWh (2026-08-15, 08:15 UTC), sitting below the threshold Italy's energy minister Gilberto Pichetto Fratin named in May. Pichetto Fratin said on Monday (2026-05-18) that mothballed coal plants could be reactivated if gas surpassed EUR 70/MWh. The market has not reached that level, and coal reactivation carries long lead times in any case, making it little comfort for a grid already stretched through August.2
Storage adds pressure from a different direction. Italy's energy regulator Arera introduced an incentive on Wednesday (2026-05-20) to push gas storage filling to 90% of capacity ahead of next winter, Montel reported. Higher thermal power demand driven by the heatwave, combined with curtailments that force load onto imports or other sources, creates competing claims on the same gas supply and makes the 90% target harder to reach.1
Standard Chartered commodity analysts have noted that extreme heat and drought are now impairing Europe's energy system through multiple channels at once: refineries are losing cooling efficiency, river levels are forcing nuclear generation cuts, hydroelectric output is falling, and barge draft restrictions are raising inland fuel transport costs, OilPrice.com reported. Italy's situation is part of that pattern rather than an isolated event.4
The 3% curtailment figure was reported as of Monday (2026-08-10). Whether it has widened in the five days since is not yet publicly updated. The key signal heading into September is whether the late-August precipitation analysts flagged actually materialises, and whether Po basin levels recover quickly enough to restore full cooling capacity before autumn storage injection puts its own claim on available gas.6,1