16 market participants bought the Finnish-Estonian electricity price risk management instrument

16 market participants purchased the risk management instrument for variation in Estonian and Finnish electricity prices, allowing for a lower risk margin for consumers.

According to Taavi Veskimägi, Chairman of the Management Board of Elering, the company is filling the wish of market participants by means of launching the risk management instrument. This gives market participants the possibility to manage price risks, reduce their costs, and thereby provide better electricity trading offers to consumers.

Market participants acquired a transmission capacity of 17.5 euros per megawatt-hour between Finland and Estonia. “When providing electricity to consumers, electricity traders can therefore take into consideration that the price difference with Finland is fixed at the level of 17.5 euros for them,” said Veskimägi.

At the first auction for Estonian-Finnish risk management instruments (FTR FI-EE Year 2023), instruments were sold within the extent of 350 megawatts for all the hours of the subsequent year in a total volume of 53.7 million euros. 27 interested parties participated in the auction, and the capacity was shared between 16 market participants. The market participants submitted purchase requests within the extent of 4,007 megawatt-hours, meaning that the volume for purchase requests exceeded the offered sales volume of instruments 11 times. The auction ended on Thursday.

In the previous year, the actual price difference between the electricity trading prices of Finnish and Estonian electricity amounted to 14.39 euros per megawatt-hour. In the first 11 months of this year, the price difference was 40.75 euros per megawatt-hour.

More information about the auction for risk management instruments is available on the pan-European auction platform https://www.jao.eu/auctions#/.