In May of last year, the price of electricity in Finland was close to zero on many days. However, the prices for spring and summer are highly dependent on weather conditions. Exchange electricity users can now determine the best times to purchase electricity. During spring floods, hydroelectric plants generate electricity at a loss due to excess water supply and sunny and windy conditions, leading to an oversupply of electricity and lower prices. While Southern Finland experiences early snow melts and floods, big hydropower plants in the north typically see floods in May. The fluctuating flood situation combined with unpredictable weather makes it difficult to accurately predict electricity prices.
Despite maintenance on the Olkiluoto nuclear power plant’s triple reactor in March, electricity prices remained relatively low. Strikes in the forest and steel industries can also impact electricity prices by reducing consumption and lowering demand. Electricity futures are an effective way to forecast electricity prices, with Nordic regional price futures decreasing in recent weeks.
In the summer, the regional price of electricity in Finland is expected to decrease due to the temporary closure of Estlink2 between Finland and Estonia. This connection is typically used to export electricity from Finland to Estonia. The variability in electricity prices during spring is not only influenced by flooding but also by weather conditions affecting wind and solar power generation.
Overall, there are multiple factors contributing to fluctuations in electricity prices, making it necessary for consumers to stay informed and adaptable in their energy purchasing decisions.
