Latvian electricity market overview

In January 2024, the average electricity price in the Latvian bidding area increased to EUR 117,16 per megawatt hour (EUR/MWh), which is 32% more than in December, while compared to January 2023, the price is 17% higher.

Highlights in January :

• In January, for the first time since April 2023, Latvia produced more electricity than consumed - total electricity production reached 832 GWh, 40% more than in December, while electricity consumption reached 696 GWh, 6% more than in December. Thus, Latvia's consumption was covered 120% by local generation;
• The electricity produced by fossil fuel plants increased significantly by 124% to 409 GWh, accounting for 49% of the total electricity produced in Latvia in January. Wind power plants also saw an increase in electricity produced, up 37 GWh, 51% more than in December, and solar power plants - up 215%, to 1,2 GWh;
• The first week of the year saw a sharp increase in electricity prices in Scandinavia and the Baltic States. The peak was reached on 5 January, when on the NordPool exchange, especially in the Finnish and Estonian price areas, electricity prices reached a record high of 1896,00 EUR/MWh, and 1478,91 EUR/MWh in Latvia and Lithuania. In parallel with the high day-ahead prices, balancing energy prices also increased during the relevant hours;
• The sharp rise in electricity prices at the start of the year was due to the severe frost, which increased electricity consumption and, to cover it, the need to use fossil fuels to generate electricity, which are more expensive. In addition, power plants with a total installed capacity of around 1700 MW were under repair in the Baltic and Finnish region on 5 January;
• Due to high water inflows into the River Daugava at the beginning of the year, Latvia was not only fully able to produce enough electricity to cover its own consumption, but was also able to export electricity, resulting in even lower electricity prices in Latvia than in Finland and Estonia in the first week of the year. This also led to a change in the Baltic electricity import/export structure at the beginning of the year: the usual direction of electricity flow is from Finland to Estonia and then to Latvia and Lithuania, but at the beginning of the year it was the opposite - Finland imported electricity from the Baltic States;
• In Latvia, the average electricity price decreased from the second week of January, as warmer weather reduced electricity consumption, increased wind power generation and increased electricity flows from Finland, where the average electricity price was lower;
• As a result of the above factors, average electricity prices in the Baltic States in January were no longer the same as in the last 3 months of last year, but increased in all 3 Baltic States - in Estonia by 42% to 126,48 EUR/MWh and in Lithuania, as in Latvia, by 32% to 117,41 and 117,16 EUR/MWh respectively;
• On 26 January, a fault caused an unplanned shutdown of the EstLink 2 electricity transmission network between Finland and Estonia, resulting in a reduction of 650 MW of electricity transmission capacity between Finland and Estonia. However, despite the unplanned outage, the Latvian power system is stable and has sufficient generation capacity to cover Latvian consumption and export electricity to Lithuania and Estonia. In addition, Nord Pool electricity prices have not been negatively affected by the outage and remain stable;
• Comparing the total monthly electricity imports to the Baltic States with the previous month, the total volume of electricity imports decreased by 13%. Electricity imports from Finland decreased by 27,5% and from Poland by 9,7%, while they increased by 1,3% from Sweden. The decrease in imports was offset by a 25% increase in production in the Baltic States - 18% in Estonia, 16% in Lithuania and 40% in Latvia compared to December;
• In 2024, a total of 205 827 GOs were issued in the Latvia Domain for GOs, which is 30% less than in January 2023 and 29% less than in December.

Raw data can be downloaded here.

Electricity production and consumption balance in Latvia*

* Here and in the following review, the electricity produced is the electricity injected into the grid and the electricity consumed is the electricity received from the grid for consumption.

** Fossil energy source – fossil gas; renewable energy sources – hydro, solar, wind, biogas and biomass.

Balance of the electricity production and consumption in the Baltic States

Interconnection load and electricity prices

Price comparison between neighbouring bidding areas

Load of the Baltic States interconnections

Electricity import to the Baltic States

GUARANTEES OF ORIGIN (GOs)

Statistics of the activity in the Latvia Domain for GOs

BALANCING MARKET IN THE BALTIC STATES

Imbalance prices in the Baltic States

Highest and lowest bid prices

Total activated energy

Average hourly standard bid size

In case of any doubts, questions or inaccuracies, please contact us at [email protected]. 

The information contained in the Market Overview is provided for informational and educational purposes only. Nothing contained in the Market Overview is to be construed or used as a basis for investment or as a basis for any claims against AST. 

Abbreviations and designations used:

LV - Latvia trade area, LT - Lithuania trade area, EE - Estonia trade area, PL - Poland trade area, FI - Finland trade area, SE4 - Sweden's fourth trade area, AT - Austrian trade area, BE - Belgium trade area, DE-LU - German- Luxembourg trade area, FR - France trade area, NL - the Netherlands trade area, DK1 and DK2 - Danish 1. and 2. trade area.

The data sources for the balance of electricity produced and consumed in Lithuania and Estonia are operational data from the ENTSO-E Data Transparency Platform, which is a central collection and publication of electricity generation, transportation and consumption data and information for the pan-European market.

Load = monthly total commercial flow in kWh / monthly total net transfer capacity in kWh ("Net Transfer Capacity" NTC).

Nord Pool is a Nordic electricity exchange where, based on market principles, the electricity price of the Latvian trading area is determined.

Guarantee of Origin (GO) is an electronic document, that proves the origin of the generated electricity. GOs are uniquely identifiable, transferable, and therefore tradable and used (by cancellation) to provide information of supplied energy to the end-consumer. One GO = 1 MWh generated and injected into the grid that has an expiration of 12 months after the end of the production period.

* Here and in the following review, the electricity produced is the electricity injected into the grid and the electricity consumed is the electricity received from the grid for consumption.

** Fossil energy source – fossil gas; renewable energy sources – hydro, solar, wind, biogas and biomass.

[1] In Latvia there are 10 distribution system operators – for more information visit https://www.sprk.gov.lv/content/pakalpojumu-sniedzeji-1

[2] Electricity imports are not commercial transactions, but electricity that has physically entered the network from other countries.

[3] Electricity exports are not commercial transactions, but electricity physically transferred from the network to other countries.

[4] According to the (ENTSO-E) definition, which does not include electrical self consumption.