Baltic electricity prices have soared and hit record highs this week, driven by low wind and solar output and rising natural gas prices, as well as a cold snap.
Erkki Sapp, a board member at grid distributor Elering, said: “This week, there has been less wind across the Baltic States, and slightly higher electricity consumption due to temperatures being a few degrees colder, and, in addition, a slight increase in gas prices compared with last week – of roughly 10%,” said.
Marko Allikson, board member of Baltic Energy Partners, a trading company, meanwhile told “Aktuaalne kaamera”: “Over the past three months, more gas has been withdrawn from storage facilities than in previous years.”
“This has mainly been caused by the “dunkelflaute” phenomenon, where there has been little wind but a lot of cold weather. During such periods, gas power plants are used, and gas is taken directly from storage. This trend is particularly noticeable in Central and Western Europe,” Allikson went on.
The price of gas on the Dutch Title Transfer (TTF) gas exchange, which serves as a reference market, has reached its highest level in nearly two years, and experts predict higher gas prices in the near future compared to last year too.
On February 12, the average electricity price reached a record high for this year – EUR 191 per megawatt-hour.
Raul Kotov, board member of Elenger, as Eesti Gaas was internationally branded, put the figure at EUR 55-57 per Mwh as “the forecast for the next three to four months. After that, prices could start to decline slightly again.”
The Baltic States are also lacking some of their regular electricity connections at present; the 650 MW Estlink 2 cable is out of operation due to the trailing anchor damage caused over Christmas time, while of the 700-megawatt Lithuania-Sweden cable connection, 100 megawatts will remain in reserve until next week. The latter too was damaged late last year.
Additionally, the 500 MW Lithuania-Poland LitPol cable is entirely offline, with 150 MW set to return to the market in two weeks; the remaining 350 MW will remain out of the market to maintain frequency stability.
Allikson noted that with more normal levels of availability, “today’s price would be EUR 60 per megawatt-hour lower.” (ERR)