OSLO — Spot wholesale power prices in the Nordic market settled at their highest level since December 2010 amid below-normal hydrological power reserves, low wind speeds and even higher prices in surrounding markets.
The benchmark system price for Friday delivery for the hydropower-dependant Nordic market settled at 98.13 euros ($116.13) per megawatt hour. The last time the day-ahead price settled higher was for delivery on Dec. 14, 2010, according to Refinitiv Eikon data.
Eleven of the 15 areas included in the system price saw daily average prices spike above 100 euros per megawatt hour, with only northern Norway and Sweden recording lower levels.
Very low wind output in the Nordics, low inflow into water reservoirs and high prices in Europe contributed to the new record, Refinitiv analyst Agnieszka Wasylewicz told Reuters.
By comparison, the German spot price settled at 138.29 euros per megawatt hour.
“The power prices will continue to climb both on the short and further end on hydrological deficit and support from the other markets,” she added.
Available Nordic water reserves, the so-called hydrological balance, 15 days ahead were last seen at 22.74 terawatt hours (TWh) below normal.
The front-quarter contract rose to a fresh all-time high of 74 euro per megawatt hour on Thursday.
Wholesale prices directly translate to consumer power bills, with many customers in Norway on spot-linked contracts.
A household in southern Norway on such a contract could see its electricity costs including transmission fees rise 8,000 Norwegian crowns ($922.87) compared to the average of the last four winters to 20,000 crowns for the period October-March, based on a consumption level 12,000 kilowatt hours, Refinitiv said in a tweet earlier this week. ($1 = 8.6686 Norwegian crowns) ($1 = 0.8450 euros) (Reporting by Nora Buli; Editing by Mark Porter)