Negative wholesale electricity price observed in Latvia for the first time

  • 2020-07-06
  • LETA/TBT Staff

RIGA - For the first time in history, a negative wholesale electricity price has been observed in Latvia - from 5 a.m. to 6 a.m. this morning, the price of electricity in Latvian price area at the Nord Pool exchange stood at minus EUR 0.09 per megawatt/hour (MWh), LETA learned from the Public Utilities Commission.

This is the first time ever such an untypical situation is observed in Latvia, the commission said.

According to the Public Utilities Commission, electricity prices had been gradually decreasing since midnight, falling to EUR 0 at 3 a.m. and then to minus EUR 0.09 at 5 a.m.

Janis Negribs, head of the Public Utilities Commission's Market Supervision Department, says that users who have signed variable exchange price agreements stand to gain the most from negative electricity prices at the exchange. In the event of a zero price, they do not have to pay for power generation costs.

A zero or below-zero price, however, has no effect on trade markups and the cost of system services, said Negribs.

In the first half of 2020, the average price of electricity at the Nord Pool exchange was EUR 28.24 per MWh, which is 38 percent lower than in the first half of 2019. According to the Public Utilities Commission's data, increasingly more customers, including households, choose to sign variable price agreements.