Electricity price at record high because of gas-fired power plants

TALLINN - Andres Vainola, chairman of the management board of Enefit Power AS, a power generating and oil shale mining subsidiary of Estonia's state-owned Eesti Energia group, said that Wednesday's record high electricity price is attributable to gas-fired power plants in the Baltic states, the total capacity of which is 2,000 MW, not making their supply offers to the power exchange for some reason.

"External connections meanwhile are loaded to the maximum," Vainola told BNS.

The price of electricity in Nord Pool (NP) bidding area Estonia for Wednesday surged 42.4 percent to a new all-time high of 682.05 euros per megawatt-hour, while the previous record high price of 500.61 euros was registered in Aug. 8.

The price will be the most expensive, 4,000 euros per megawatt-hour, between 6 p.m. and 7 p.m. on Wednesday. The price will be cheapest, 305.72 euros per megawatt-hour, between 3 p.m. and 4 p.m. 4,000 euros per megawatt-hour is the highest permitted price on the Nord Pool power exchange.

Ingrid Arus, Nord Pool's market representative for Estonia, Latvia and Lithuania, said that the price hits the ceiling of 4,000 euros per megawatt-hour when the quantities sold to the market during that hour do not cover the quantities that other parties wish to buy. Arus noted that in the entire Baltic region, there is only 1,124.1 megawatt-hours on offer for that hour.

The average exchange tariff of electricity will be 823.98 euros in Latvia and Lithuania, 20.8 percent higher than in Estonia and marking the highest price on the Nord Pool market. 

Arus said that the record high price is mainly attributable to low generation of wind power and production units undergoing maintenance as well as low water level in Latvia, which has reduced the supply of hydropower to the market. Vainola noted that power plant repairs are planned and announced long in advance.

"These works are conducted in summer, which is the period when consumption is lower, to prepare the power plants for higher demand in the fall and winter," Vainola said.

The chairman of the management board of Enefit Power added that at present, Enefit has three oil shale power plants producing electricity and within the next few days, the Auvere power plant as well as the 11th power generating unit at the Balti power plant are to resume supplying electricity to the market.