Major data center developments in Finland could hike electricity prices in Estonia
If no new generation is added in either country, Google's Finnish data centers investment could hike the price of electricity by half a cent per kilowatt-hour in Estonia, experts warn.
Google is investing €13 billion in Finland to build large data centers there. The highly energy-intensive centers will buy half of the electricity generated by Finland's Loviisa nuclear power plant over the next 22 years. This could leave Finland with less surplus electricity that countries such as Estonia have been able to buy cheaply.
"This naturally means that prices there will rise, and if prices rise there, they will also rise for us during periods when we import electricity from Finland. Looking at this year, electricity consumption in Finland has actually increased by around 500 megawatts compared with 2025. There may be several factors behind that, but excluding the coldest winter months, the price in Finland has risen by €5 per megawatt-hour over the past year and that has also had an impact on us," said Tiit Hõbejõgi, a member of the management board of Eesti Energia subsidiary Enefit.
In that case, the price would rise by 0.5 cents per kilowatt-hour, although additional generating capacity is expected to come online in Finland.
"There will certainly be certain times when the surplus on the Finnish energy market, which has perhaps been one of its defining features, will be somewhat smaller. The average price will probably remain largely where it is today. Market volatility may increase, with some additional hours when electricity is very expensive. On the other hand, because this additional demand will also spur the construction of new power plants, there will also be quite a few hours when electricity prices are again very low because more cheap wind power has entered the market," said Timo Tatar, CEO of Ignitis Eesti.
In recent years, Estonia has imported 40 percent of the electricity it consumes from Finland and other Nordic countries. Estonia should not rely on how much surplus energy it can buy from its neighbors, transmission system operator Elering CEO Kalle Kilk said.
"If consumption increases and supply has not increased by the same amount, that clearly affects both security of supply and prices. We have to take into account that we in Estonia have been quite dependent on the situation in our neighboring countries. The main conclusion for us is that in the future we need to take somewhat greater responsibility ourselves for ensuring that we have enough electricity that can also be generated domestically," Kilk said.
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Editor: Marcus Turovski, Johanna Alvin
