Lower demand due to summer holidays, reservoirs filling with water and winds these days led to an 80% drop in electricity prices for the Nordic region on Friday. Average electricity prices across northern Europe for Saturday fell to $4.24 (€4.17) per megawatt hour (MWh) on the Nord Pool exchange in Oslo, according to Bloomberg estimates.
By comparison, day-ahead prices in France were $338 (€333) per MWh and $150 (€148) per MWh in Germany.
Day-ahead prices in the Nordic countries hit their lowest level since November 2020 due to a combination of factors. These include increased wind power generation, people leaving for summer vacations, and enough water to generate hydroelectricity.
Electricity prices for 2023 are also much lower in the Nordic countries than in Germany, for example. The contract for Nordic prices next year was at $112 (110 euros) per MWh on Thursday, compared with a record high of $377 (371 euros) per MWh in Germany, according to Bloomberg.
Water reservoirs in Norway, however, were 59.2 percent full at the end of last week, below the 20-year average, according to data from the Norwegian Directorate of Water Resources and Energy (NVE). Hydropower producers have been discouraged in recent weeks from pumping more water for hydropower generation and conserving water for the winter. Operators were also asked not to export too much electricity to the rest of Europe, as reservoirs are not as full as in previous years, and not to rely on imports from Europe, which is struggling with energy supplies.
By Michael Kern for Oilprice.com
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