Notably lower market price of electricity in recent days follows lower holiday consumption, warmer than average weather, windy conditions and the Oskarshamn Nuclear Power Plant returning to service after repairs, Eesti Energia analyst Olavi Miller told ERR. Last week saw the price of electricity fall by 50 percent on week.
"Looking at the bigger picture, demand is lower during the holidays – both in Estonia and northern Europe and Europe in general," Miller told ERR on Tuesday, adding that usual morning and afternoon peaks do not occur. Many power-intensive industries are also shut down for the holidays.
Favorable weather conditions have helped to boost generation while reducing consumption. "Firstly, it has gotten a little warmer, especially compared to last week, while the weather is 1-1.5 degrees warmer than the long-time average here in northern Europe – this works to lower demand," Miller remarked.
"Another thing, especially in the new week, is favorable wind conditions for turbines. There is solid wind generation. It was even feared in Germany that prices might be negative during Christmas because of all the wind. But that did not quite happen," the analyst said.
On Tuesday, hydroelectric plants yielded almost half and wind turbines a quarter of all energy sold on the Nord Pool exchange.
Miller also pointed out that the Oskarshamn 3 Nuclear Power Plant in Sweden that contributes 1,400 megawatts recently came back online.
"This is constantly added to base generation, meaning that there has been no need for gas-fired power plants in recent days, which has kept prices from climbing."
The analyst said that another cold spell and the Finnish Olkiluoto 3 nuclear plant being out of commission until March could see the prices spike again.
Miller also said the low price period is a good time to carry out maintenance at Estonian oil shale power plants where filters are being replaced to make sure they would be operational when colder whether usually hits in January and February. Estonia's newest Auvere power plant is out of commission once again.
Prices down 50 percent last week
Eesti Energia's electricity market overview reveals that the average price in the Estonian price region of the Nord Pool exchange was €178.7 per megawatt-hour last week, €184/MWh or roughly 50 percent lower than the week before.
Electricity was cheapest at 4 a.m. on December 24 at €33.32/MWh and most expensive at 8 a.m. on December 21 when it hit €304.19/MWh..
The average price will be €133.81 on Wednesday, December 28.
Editor: Mait Ots, Marcus Turovski