Electricity prices surge in Finland amid supply shortages and rising demand

The era of very cheap electricity in Finland appears to be over for now, as futures prices have significantly increased over the past week. “The regional price in Finland has risen sharply,” said Marko Pikkarainen, chief analyst at Lumme Energy. Concurrently, there is upward pressure on the prices of fixed contracts. “The prices of fixed-term contracts will rise as futures prices increase,” stated Johannes Gylén from Väre.

The rise in daytime electricity prices has led to higher prices for six-month and one-year futures. In the futures market, electricity buyers enter into contracts for future electricity supply, predicting whether prices will rise or fall in the coming months or even years. As of Tuesday, Finnish electricity users faced peak prices as high as 33 cents per kilowatt-hour, with a anticipated decrease to a maximum of 15 cents on Wednesday.

The electricity price has surged in the past week due to a decrease in supply in Finland. Several factors contribute to this situation, including two nuclear power plants being offline. The Loviisa plant is undergoing maintenance, and the Olkiluoto 2 plant is out of operation due to a fault, expected to remain offline until September 29. Additionally, generation from wind power has been low due to calm weather, along with transfer restrictions between Finland and Sweden.

Looking ahead, electricity for 2025 is being sold at higher prices, although futures prices for the following year are lower. The price increases for 2026 and 2027 have not been as significant. Gylén noted that the increase in futures prices is also fuelled by rising demand, as high spot prices have led more consumers to switch to fixed contracts. When customers transition to fixed pricing, power companies secure additional futures for their own cost forecasting. This article will be updated as more information becomes available.