Outages and costly Central European power push Baltic prices higher

Power plant maintenance across the Baltic states and high electricity prices in Central Europe have driven regional prices sharply higher, ERR reported. Estonia’s daily average price reached 305 euros per megawatt-hour on Tuesday, its highest level since early February, and stood at 248 euros on Wednesday.

Estonia’s average price for the first 11 days of November was 199.2 euros per megawatt-hour. That compares with monthly averages of 154 euros in both January and February, when prices were also high. The November average was even higher in Latvia, at 304 euros, and Lithuania, at 295 euros. In Finland, it was 71 euros.

Estonia’s price is currently below those in Poland and Germany, partly because Eesti Energia has brought oil-shale power plants out of reserve, Enefit board member Tiit Hõbejõgi told ERR. Prices could be lower if more Estonian plants were available, particularly the 260-megawatt Auvere plant, which is undergoing maintenance for about another week. A boiler at the 105-megawatt eighth unit of the Eesti power plant is also offline, leaving 365 megawatts of generating capacity out of the market.

The third and fourth units at the Eesti power plant cannot enter the market, Hõbejõgi said. The fifth and sixth units are operating, as are one boiler at the eighth unit and the 11th unit at the Baltic power plant.

Calm, colder weather has also reduced renewable generation. Baltic wind farms produced an average of just 0.5 gigawatts, about 10 percent of their total capacity, Hõbejõgi said. Solar generation was very low. The share of electricity demand met by wind and solar fell from 40 percent in October to about 20 percent in early November, while solar output nearly halved, said Hardi Koduvere, a senior analyst in Elering’s energy market modelling team.

Swedish transmission constraints and maintenance at nuclear plants have also contributed to high prices, Hõbejõgi said. Transmission capacity between Sweden’s southern price zones SE3 and SE4 is limited by two to three gigawatts. Three reactors with a combined capacity of about 3.3 gigawatts are under maintenance: Forsmark 1 is due back on November 17, Ringhals 4 on November 21 and Ringhals 3 on November 28.

With transmission constrained, Sweden’s southernmost zone, SE4, has to import electricity from Germany, where prices are high. That affects the Baltics because the expensive power can reach the region through the NordBalt electricity cable linking Sweden and Lithuania. Poland, another high-price market, also trades electricity through Lithuania, adding further upward pressure, Hõbejõgi said.

The Baltic states’ own power plant maintenance has added to the rise. Latvia’s and Lithuania’s newest and most efficient gas-fired plants are both undergoing repairs. In Lithuania, a 455-megawatt unit at the Elektrėnai power plant is scheduled to remain offline until November 25.