Tallinn, Estonia, January 31, 2024 – electricity prices in Estonia are poised to remain stubbornly high in the coming days, fueled by a rapid surge in gas costs and a persistent lack of wind. The situation is forcing the nation to lean heavily on older, less efficient power sources.
Electricity Prices remain High in Estonia Amid cold Snap
A chilly,windless spell is keeping electricity prices elevated across Estonia,with little immediate relief in sight.
Jõgi explained that older gas-fired power plants, still operational in many parts of the Baltic states, are contributing to the upward pressure on prices. “Now, it is actually gas power plants that largely determine our prices. Consumption is currently very high across the Baltics – at 5,000 megawatts – which means gas power plants are definitely the ones setting the final prices. Because the price of gas has risen, this naturally has a direct impact on the price of electricity,” he stated.
Currently, Estonia is importing electricity from Finland at maximum capacity, exceeding 1,000 megawatts. Oil shale power plants are also actively operating, though the Auvere oil shale power plant is undergoing repairs. Solar parks are currently underperforming due to snow cover, but improved conditions and lower prices are anticipated starting in March.
“at the moment, when the solar panels are covered with snow, they are not producing anything. But when the panels are clean and the sun is shining, solar production will start to increase. The beginning of spring is the time when production may start to increase,” Hõbejõgi explained.
As of this year, oil shale has accounted for almost 40 percent of the Baltic states’ energy production, while wind power contributes 35 percent, with the remainder coming from other sources. Prices are expected to remain volatile, possibly exceeding €400 in the coming days before dropping to around €100 during mornings and evenings.
Hõbejõgi believes that increased battery storage capacity could help mitigate price fluctuations. “The more battery parks there are, the more they will have an impact on the price of electricity the following day. Wednesday is a great exmaple of how, in the first half of the day, batteries could be fully charged for €100 in the morning and then discharged before noon at a price of nearly €400. The more batteries there are, the more stable prices could be, and of course, end consumers would also benefit significantly from this,” he said.
Consider supporting investments in energy storage to help stabilize electricity prices.
