Electricity Prices in Estonia Rose 27% in September
The average exchange price of electricity in Estonia in September was 7.5 cents per kilowatt-hour before VAT, up 27% from August. In Latvia and Lithuania the average reached about 10.8 cents.
The average electricity exchange price in Estonia in September reached 7.5 cents per kilowatt-hour excluding value-added tax, which is 27% higher than in August. In Latvia and Lithuania, the average price was around 10.8 cents per kilowatt-hour. The figures come from an overview by Enefit, a state-owned energy company.
Enefit explains that the gap between Estonia and its Baltic neighbours is mainly due to Estonia's broader ability to obtain cheaper electricity from the Nordic countries.
What influenced prices
Prices in the region were affected by wind and solar output, the availability of imports, the cost of natural gas and low water reserves in the Nordic countries.
In September, solar power generation in the Baltic states fell by 39% compared with August, to 439 gigawatt-hours. Wind generation, by contrast, rose by 29% to 655 gigawatt-hours. Together, wind and solar covered about half of electricity consumption in the Baltics.
During periods of strong wind, higher renewable output helped push exchange prices down. When the wind died down, more expensive power plants had to be brought online to meet demand, causing sharp price spikes.
Maintenance work on the NordBalt interconnector between Sweden and Lithuania, as well as at several nuclear power plants in Finland, had an additional effect. This limited the region's ability to offset lower renewable output with cheaper imports.
What to expect next
Analysts say that as the heating season begins, the influence of weather on electricity costs will grow. Reduced solar generation and higher consumption on cold, dark days may increase the need for imports and for the use of oil shale and gas-fired power plants.
Gas prices remain an additional risk factor. Although gas reserves in Europe grew in September, they were still noticeably below the levels typical for this time of year in recent years.
Enefit notes that the average electricity price may remain moderate, but individual periods of sharp price increases and drops could become more pronounced.
