Electricity Trading Price Hits '0 Won' in This Country... Powered by Hydroelectric and Nuclear Energy

Finland Sees Sharp Increase in Hydropower Generation as Glaciers Melt
Newly Operated Nuclear Plant Also Covers 14% of Demand

Electricity prices in Finland have reportedly reached '0 euros' at one point, drawing attention. This is due to an increase in hydropower generation and the operation of the recently completed largest nuclear power plant in Europe. There are even forecasts warning that electricity supply may surpass demand, causing a sharp drop in electricity prices.

Finnish local media Iltalehti reported on the 29th (local time) that Finland's spot electricity price once hit 0 euros. According to price information from the Finnish power exchange Nord Pool, the spot price actually fell to zero the previous day but rose to 1.2 euros per kilowatt-hour (KWh) as electricity demand gradually increased from the afternoon.

This is the second time Finland's spot electricity price has dropped to 0 euros, following the 24th. Recently, Finland's electricity supply has exceeded demand, causing spot prices to plummet.

Olkiluoto Nuclear Power Plant in Finland
[Image source=Yonhap News]

The sharp increase in electricity production is due to hydropower. Thanks to the arrival of spring, glaciers on the Scandinavian Peninsula have melted, increasing glacial runoff and raising water levels in Finnish dams. Consequently, hydropower generation surged significantly, leading to an oversupply of electricity.

Meanwhile, Finland's new nuclear power plant 'Olkiluoto 3,' which began operation in April, has also increased electricity supply. Olkiluoto 3 has a capacity of 1.6 gigawatts (GW), making it one of the largest nuclear plants constructed in Europe. It alone accounts for 14% of the total electricity demand of Finnish households.

After Russia's invasion of Ukraine caused a sharp rise in natural gas prices and triggered an energy crisis in Europe, Finland, which has increased its share of clean energy and nuclear power, appears unaffected by this trend.

On the contrary, voices in Finland are expressing concern over a potential sharp drop in electricity prices due to oversupply. Jukka Ruusunen, CEO of Finnish state-owned transmission company Fingrid, told the media, "Price fluctuations have encountered an unprecedented situation," pointing out that "electricity is now being overproduced in Finland to the extent that power suppliers may have to pay costs to produce electricity."

The operator of Olkiluoto 3, Teollisuuden Voima, also recently held an emergency meeting and decided to reduce electricity production temporarily.