Electricity Prices Fell in Nordics and Baltics Last Month

According to the Nord Pool Spot (NPS) power exchange, the price of electricity fell in November, in both the Nordic and the Baltic countries. In Latvia and Lithuania, the price was more than a quarter below that of October.

The NPS system price fell by 4.3% to 36.70 euros. The NPS Estonia price area saw a drop of 9.5% to 42.32 euros, while the average price in Latvia and Lithuania was 47.32 euros per megawatt-hour.

The overall price drop was caused by warm weather in both the Nordics and the Baltics, driving down consumption in comparison to normal numbers for the start of the heating season. In addition, the undersea cable between Norway and the Netherlands was out of order for all of November. At the same time, the fill rates of Norwegian hydro reservoirs remained lower than during the same period in recent years.

A significant reduction came in the difference between the NPS system price and the Latvian and Lithuanian price areas. While in October, the average price in the NPS Latvia and NPS Lithuania price areas was 62% above the system price, in November the average price in the NPS Latvia and NPS Lithuania price areas was only 29% above the system price. The reduction in the price difference is due on one hand to increased imports from third countries, primarily renewed imports from Kaliningrad, and on the other hand to fewer transmission capacity shortfalls at the Estonian-Latvian border.

In November, power flows across the EstLink 1 interconnection were directed from Finland to Estonia for 89% of the time (644 hours), and from Estonia to Finland for 10% of the time (76 hours). Estonian and Finnish prices converged for 54 percent of all hours last month, and Estonia’s price was the same as that of Latvia and Lithuania for 69 percent of all hours.

The prices of carbon dioxide emission quotas fell slightly last month, fluctuating between 4.34 and 4.79 euros per ton. The monthly average price of natural gas imported into Estonia was 31.69 euros per megawatt-hour in November, according to Elering’s estimates; this is 98 cents above the October price.

The full report on the electricity market in November is available here.