TALLINN – Hando Sutter, CEO of Estonia's state-owned energy group Eesti Energia, said on Thursday that the price estimate for electricity for the Estonian market in the coming winter has increased significantly compared to what was expected in the spring.
"A normalization of the price could take place in the second quarter of next year, but to the levels it was at this spring, that is, over 100 euros per megawatt-hour," Sutter told a press conference held on the occasion of the publication of the group's interim result.
In price area Estonia of the Nord Pool electricity exchange, the average price for July was 233.21 euros per megawatt hour, more than twice as much as in July 2021, when the average price was 83.78 euros per megawatt hour. The average market tariff for July was, among other things, 15.1 percent higher than the previous monthly record registered in December of last year.
Eesti Energia announced earlier on Thursday that it earned a net profit of 33 million euros in the second quarter of this year on sales revenue of 416.4 million euros, compared with a loss of 18.7 million euros on revenue of 241.1 million euros posted for the same period last year.
Sutter said that the good result of course can be attributed to higher energy prices, but also to higher sales volumes, especially outside Estonia. The increased prices meanwhile are due to low supply.
According to the CEO of Eesti Energia, there is enough capacity in the region to cover demand, but that capacity is gas-fired.
"A very large proportion of the gas in the whole region came from Russia, and it's no longer coming," Sutter said.
The CEO said Eesti Energia will conduct an inspection of all its power plants this summer, including those that originally were not scheduled to be maintained this year, so that they will be dependable in the winter. Oil shale mining will also be increased.
However, the company recommends opting for a fixed-price package for greater feeling of confidence. Fixed-price packages are already used by nearly 300 000 people, or two-thirds of customers. While in 2019, the average price level in such agreements was 60 euros per megawatt-hour, today the biggest single proportion of fixed-price customers, 27 percent, are buying electricity at 101-150 euros per megawatt-hour.