Europe's power curve on Thursday afternoon recovered from new 7-1/2 month lows hit in early trading as oil rallied after an unexpected European Central Bank rate cut and as carbon turned positive after its recent slump. "The forward market is following the macro and fuels markets trends, where everything hangs in balance. Volumes are still thin," one trader said.

German Cal '12 baseload, was last at 54.70 euros a megawatt hour, up 40 cents on the day and up 55 cents from the early morning level of 54.10.

French Cal '12 was at 53.65 euros, after hitting 53.15 euros in the morning.

Energy prices firmed on an ECB decision to cut its main refinancing rate by 25 basis points as worries about the euro zone overrode inflation concern.

This together with positive U.S. macro data lifted oil, while carbon and gas prices also rebounded.

Greece's teetering government backed away from a proposed referendum on staying in the euro and European leaders talked for the first time of a possible Greek exit to preserve the single currency.

Prompt power prices were lower due to the mild weather scenario, curbing demand. Temperatures are milder than seasonal averages, between 12 and 18 degrees.

French power consumption is likely to rise next week to 70,000 MW, up from 64,000 MW on Thursday, as temperatures are expected to cool and industrial activity recovers after the mid-term break.

German day-ahead baseload lost 0.75 euros to 54.50 euros and French Friday delivery was off 50 cents at 52.50 euros.

German energy use in 2011 is likely to fall by about 4 percent from 2010 levels, industry statistics group AGEB said on Wednesday, basing its forecast on preliminary data for the first three quarters.

RWE put back by one day the anticipated return of its 1,344 MW Gundremmingen C reactor to the grid after maintenance, to between November 3 and 5, from a formerly cited November 2 to 4.