Price of electricity to fluctuate wildly on Tuesday
On Tuesday morning and evening, the electricity price on the Nord Pool power exchange in Estonia will spike to €800 per megawatt-hour and in Latvia and Lithuania to over €1,100.
On Tuesday, the average electricity price in Estonia will rise to €181 per megawatt-hour — nearly twice as high as on Monday. The last time the daily average was this high was August 22.
According to quarter-hour trading data, electricity prices will be highly volatile throughout the day. For example, between 8:15 and 8:30 a.m., the price will spike to €890 per megawatt-hour, and between 7:15 and 7:30 p.m., to €799. However, during the afternoon, prices will stay below €100 for several hours and drop to as low as €20 after midnight.
In Latvia and Lithuania, prices will be even more erratic on Tuesday, reaching up to €1,173 at peak hours. In Finland, the price will fluctuate between €1 and €226 per megawatt-hour during the day.
Estonia switched to quarter-hour electricity trading last week.
Eesti Energia said that unusually large intraday price swings had already occurred in September.
"On several days, price differences reached €80–150 per megawatt-hour. This created significant earning opportunities for batteries that could charge from the grid during cheaper hours and discharge during expensive ones," the energy group said.
Eesti Energia added that using batteries across other energy markets would further increase their revenues. For instance, a battery with a capacity of 1 megawatt and storage of 2 megawatt-hours could have earned up to €14,000 in the day-ahead market in September.
Commenting on last month's electricity prices, Eesti Energia noted that the average electricity price in Estonia in September rose to 8.1 cents per kilowatt-hour (€81 per megawatt-hour), about 5 percent higher than in August. Compared to the same period last year, the price remained nearly unchanged — in September 2024, it averaged 8.4 cents per kilowatt-hour.
Eesti Energia attributed the price increase to several factors. First, solar power generation in the Baltics dropped by about 35 percent due to cloudier weather and shorter daylight hours. Second, the 350-megawatt EstLink 1 interconnection between Finland and Estonia was out of service for much of the month, reducing import capacity from 1,000 to 650 megawatts. In addition, Latvia's hydropower output fell by about 50 percent compared with August after an unusually strong summer.
"As a result, during peak consumption hours, the Baltic power system had to rely more on local oil shale and other fossil fuel-based production, which drove prices up," Eesti Energia said.
In October, as heating demand and electricity consumption increase while solar output declines, electricity prices will mainly depend on wind conditions and the Nordic countries' export capacity.
Simply put, windy and warmer weather means lower electricity prices, while calm and colder conditions require using gas or oil shale power plants to meet demand, pushing prices higher.
"Prices may also rise due to maintenance on the EstLink 2 interconnection at the end of October and the Lithuania–Sweden cable at the beginning of the month," Eesti Energia noted.
Electricity prices on the market are determined by the last producer offering the remaining required volume. When prices stay around 6–7 cents per kilowatt-hour, they are mainly set by solar, wind or imported Nordic energy. When prices reach €100 per megawatt-hour, the last supplier is typically a gas-fired plant in the Baltics. If the price exceeds €150, it is often determined by Estonia's oil shale power plants, Eesti Energia said.
--
Editor: Marko Tooming, Marcus Turovski
