Last week – from 4 March to 10 March of this year – both rising and falling electricity price trends were observed in the Baltic and Nordic countries. Meanwhile, natural gas and woodchip prices on the market have approached an almost equivalent price level. The market price for natural gas last week was €26.4/MWh, which corresponds to the natural gas price in May 2020, and the price for woodchips was €23.88/MWh.
Electricity prices
During the past week (from 4 March to 10 March), electricity prices on the Nord Pool exchange both rose and fell. The average electricity price in Latvia and Lithuania was identical last week – €75.39/MWh, while in Estonia it was €75.61/MWh. Meanwhile, the average electricity price in Finland last week was 10.6% higher – €84.34/MWh. Price fluctuations in the region were influenced by lower wind power generation, as well as a decrease in rainfall, which negatively affected water inflow and the filling level of hydro reservoirs in the region.
At the same time, on the morning of 9 March, shortly before 4.30 am, a technical fault occurred at a transformer station in Espoo, near Helsinki, resulting in the disconnection of one of the two electricity cables connecting Estonia and Finland (Estlink1). However, the cable was back in operation within a few hours, during the first half of the same day. The electricity cable itself remained intact.
Minister for Climate and Energy Kaspars Melnis: “Even though the electricity cable (Estlink1) connecting Estonia and Finland was out of operation for 8 hours on Saturday, 9 March, the operation of the electricity supply system in the Baltic states was stable and secure. The brief cable outage has also not affected electricity prices in the Baltics. Meanwhile, restoration work on the second interconnection, Estlink2 (Finland-Estonia), is ongoing. In close cooperation with our colleagues at the Estonian ministry, we will look for solutions to facilitate faster completion of repairs and the restoration of the Estlink2 (Finland-Estonia) interconnection. This Thursday, 14 March, the matter will be discussed with the Estonian Minister of Climate during a visit to Paldiski and Tallinn.”
Latvia produced 253,285 MWh last week, while consumption was significantly lower – 130,428 MWh. Electricity was primarily produced using hydro resources (78%), thermal power plants, and wind energy.
Fuel resource prices
Meanwhile, last week, natural gas prices on the TTF exchange increased by 2.3% to €26.4/MWh, which is equivalent to the price four years ago, in May 2020. The filling level of the Inčukalns storage facility was 48.3% on 10 March, which is equivalent to approximately 11.6 TWh. In Europe, the filling level of natural gas storage facilities is near a record high before the end of winter – 60.8%. Last week (04.03–10.03), natural gas consumption in Latvia was 249,215 MWh, which is 13.8% higher than what was consumed the previous week.
In turn, the price of woodchips in Latvia, compared to the week before (26.02–03.03), has increased by 1.5%, reaching €23.88/MWh. The price of woodchips is currently significantly lower than the average price of woodchips purchased during the 2022/2023 heating season – €42.50/MWh.
“Natural gas price forecasts for the coming months suggest stable prices with a slight decline. In April, the natural gas price is expected to be €24.70/MWh, and in May – €24.78/MWh. Although the heating season is coming to an end, preparations for the next heating season begin as early as spring and summer. In most cases, heat energy suppliers sign long-term fuel supply contracts when resource prices on the market are at their lowest, ensuring stable and secure supplies for the next heating season,” explains Minister K. Melnis.