On the morning of Friday 16 October, the price of electricity has tripled from the day before:
– Friday at 10 o’clock, one single hour costs 60 øre per kilowatt hour, ie three times as much as the day before, says chief analyst Tor Reier Lilleholt in Wattsight to Dinside.
– If we look at the last two weeks, pure power prices have increased tenfold. At the beginning of October, the price was approx. 2.2 øre per kilowatt hour, while now we are up to 27 øre per kilowatt hour, he adds.
So much cheaper is electricity
What is the reason for this?
– This is a consequence of the fact that the power markets around us have a high price. Consumption in this country is increasing, and southern Norway therefore has the opportunity to increase prices now, Lilleholt explains.
In addition, we are now facing the “bottling season” for the overcrowded reservoirs, which have given us historically low electricity prices this summer and right up until the beginning of October.
– Now, on the other hand, there are significantly lower temperatures and less precipitation in the weather forecast. This will eventually lead to precipitation coming as snow, and then higher production is needed to cover the increase in the forearm towards the winter, says Lilleholt.
– Therefore, we now use more water from the reservoirs every day, than what is filled up from inflow. As a result, producers now have greater opportunities to raise prices to a higher level, as they see a significantly lower risk of losing water if it gets wet and mild again this autumn, the chief analyst continues.
“Insure” yourself against electricity price jumps
– Still historically low price
However, Aslak Øverås, Information Manager at Energi Norge, emphasizes that despite sharp fluctuations in electricity prices in recent weeks, the price level is still historically low:
– The average price in recent weeks has been less than half of what is usual for the season, Øverås says to Dinside.
How will prices continue this winter?
For winter electricity prices, temperature becomes the most important driver, not necessarily how much precipitation comes – it becomes more important in terms of how much snow will melt in the spring.
It is expected that the price in shorter periods where there is a shortage of capacity, will reach 40 øre per kilowatt hour, but with mild weather we can get a similar development as earlier this year:
Low consumption and a lot of extra water in the reservoirs will create competition to produce electricity from the existing water, and prices will be lowered to a level of 15 øre per kilowatt hour.
Crazy electricity prices: – Unique
Record amount of water in the reservoirs
Tuesday, October 13 reported Norwegian Water Resources and Energy Directorate (NVE) that the degree of filling in Norwegian water reservoirs was 95 per cent.
This is the highest filling level at the corresponding time for the entire 2000s.
Eastern Norway had the highest reservoir filling with 98.7 per cent, while Northern Norway had the lowest filling with 92.8 per cent.
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