## 2 Background for Own Research  
The significant growth in renewable energy shares across various European countries, as illustrated in Table 1, has been largely driven by comprehensive EU-level policies and national initiatives aimed at promoting renewable energy development. A cornerstone of this policy framework is the Renewable Energy Directive (RED), initially established in 2009 and subsequently revised to set targets that are more ambitious. The latest amendment, Directive (EU) 2023/2413, enforces a binding target of at least 42.5% renewable energy in the EU's overall energy consumption by 2030, with an aspirational goal of reaching 45%. This directive also introduces sector-specific targets and streamlines permitting procedures to accelerate renewable energy deployment. Complementing the RED, the European Green Deal, launched in 2019, serves as the EU's overarching strategy for achieving climate neutrality by 2050. It emphasises the decarbonisation of the energy sector, which accounts for over 75% of the EU's greenhouse gas emissions, by promoting energy efficiency, developing a fully integrated energy market, and prioritizing the use of renewable sources. In response to the energy market disruptions following geopolitical events, the EU introduced the REPowerEU plan in 2022. This initiative aimed to reduce dependence on fossil fuel imports, particularly from Russia, by accelerating the deployment of renewable energy, enhancing energy savings, and diversifying energy supplies. Financial mechanisms have also played a crucial role. The EU Clean Industrial Deal, proposed in 2025, includes a 6100 billion fund to support clean manufacturing and reduce energy costs. Key elements of this plan involve launching a 6500 million pilot programme with the European Investment Bank for renewable power purchase agreements, providing a 61.5 billion package to support power grid component manufacturers, and simplifying state aid rules to facilitate clean energy investments. Collectively, these policies and initiatives have created a conducive environment for renewable energy growth, leading to the observed increases in renewable energy shares across EU member states [8,9]. As the share of renewable energy sources (RES) in European electricity systems grows, their impact on price dynamics--particularly on the volatility of wholesale electricity prices--is receiving more and more attention. Research in this area has been significantly updated in recent years, mainly due to a combination of geopolitical events and the increasing penetration of RES. An IMF study [1,7] analyzed data from 24 European countries over the period 2014-2021 and showed that a higher share of RES has a statistically significant impact on reducing the average electricity price. However, it also identified that the effect on volatility is not clear-cut; in some quantiles, the price distribution volatility increases, while it decreases in others. According to [10,11,12,13,14,15], when a certain share of RES is exceeded, there is an increase in extreme price volatility, which has major implications for the market and system operators. These fluctuations are particularly concentrated in the hours of high production from solar and wind resources, when prices can suddenly drop to negative values. They found that when a certain RES share threshold is crossed, there is a significant increase in extreme price fluctuations, especially in hours with high generation from solar and wind resources. These fluctuations can lead to negative electricity prices. Volatility remains stable at low RES shares, but volatility increases rapidly when a certain threshold is crossed, especially in hours with extreme generation. Solar energy has a stronger impact on daily price fluctuations as its production is concentrated around midday. Wind power, on the other hand, causes volatility in the evening and night hours. In most OECD countries, the incidence of negative and very low prices has increased precisely during the hours of highest RES production.