Price volatility makes electricity consumers consider adjusting habits
For a few hours on Sunday afternoon, electricity prices in Estonia were negative, with such large fluctuations making consumers consider adjusting their consumption habits. Experts say that there are further fluctuations to come, but it will be difficult for private consumers to constantly change the way they consume electricity.
There have been several occasions this year, when electricity prices have been negative. This mainly happens mainly during periods of high supply and low consumption or when increased amounts of wind and solar power are available.
"Today was the most extreme day. There were hours during the day when prices were at minus 6 or 7 cents per kWh (Kilowatt hour). And it is safe to say that we may start to see more and more times like these thanks to the increased solar generation capacity," said Kalvi Nõu, portfolio manager for energy trading at Alexela.
Private electricity consumers did not earn much from Sunday's negative electricity prices as such periods are short and generally fall at times when they are not consuming a lot of electricity.
"Looking at (Sunday) alone, the benefit would maybe be a few euros, because the bill accumulates over the whole month. In practice, the biggest benefit would come if people could avoid permanently high electricity price peaks," said Indrek Velthut, CEO of TarkHoone.ee.
This year, electricity prices have fluctuated more than in the past. The question is – how can consumers stay abreast of these fluctuations in order to react to them?
"Big consumers such as heating and electric boilers - these are important to automate on their own, because manually monitoring your electricity exchange price every day and changing your habits and consumption is not very realistic for most people," said Velthut.
Another issue is storage. If electricity storage options were to increase, then average prices would fall further.
"Storage is certainly a very important component in keeping the grid stable. The question is, if there is enough of this storage capacity, will there be negative prices or not? They are more likely to be lower. But the average price during the day tends to remain more stable," said Armen Kasparov, head of energy products at state-owned energy generator Eesti Energia.
Perhaps ironically, the biggest losers in these situations are solar energy producers - their output on Sunday was zero.
--
Follow ERR News on Facebook and Twitter and never miss an update!
Editor: Michael Cole
