Electricity Market Concentration Has Decreased

The changes in the electricity market that took place at the turn of the year are reflected in January’s distribution of consumption volumes, which show a decrease in the market concentration. The biggest electricity seller’s balance portfolio share in relation to the total market volume has decreased, and several of the next biggest market participants grew their portfolios year-on-year.

According to Taavi Veskimägi, Chairman of the Board of Elering, the Estonian electricity market is increasingly beginning to look like a competitive market with multiple sellers. “The noticeable decrease in the biggest seller’s share ought to silence the voices that claimed the Estonian electricity market does not give consumers a choice,” he remarked. The launch of EstLink 2 should further increase the opportunities for competition, by making it easier for Nordic electricity sellers to enter the Estonian market.

According to statistics from the Data Warehouse, some 554,000 consumption points had an electricity purchase contract as of the end of January, while the number of consumption points without a contract that were consuming electricity as a general service was around 160,000. The share of general service is around eight percent of total consumption.

3,600 customers who had decided to switch electricity sellers had their new contracts come into force as of the start of February. The amount of people who switched sellers was several times higher than during the first months of the previous year.

The market shares of balance providers, which include both the network losses of network operators and the amounts of electricity consumed as a general service, are provided in the table below. The shares of the balance providers’ portfolios in the system consumption are calculated from the total consumption amounts metered within the balance providers’ balance area. Balance provider market shares do not coincide with the balance providers’ own shares of electricity sales to end consumers, as the balance portfolio also includes the electricity amounts of other sellers belonging to the portfolio.