Latvian electricity market overview

In November 2023, the average electricity price in the Latvian bidding area increased to EUR 105,20 per megawatt hour (EUR/MWh), which is 20% more than in October, while compared to November 2022, the price is 54% lower.

Highlights in November :

• In November, the total amount of electricity produced in Latvia reached 500,5 GWh, which is 74% more than in October and 1% more than a year ago, while the amount of electricity consumption reached 611,5 GWh, which is 3% more than in October and 2% more than a year ago;
• The volume of electricity produced from hydroelectric power plants increased significantly by 148% to 261,7 GWh, accounting for 52% of the total volume of electricity produced in November. Also compared to November 2022, hydroelectric power plants show an increase of 66,1%;
• The amount of electricity consumption covered by local generation was 82%, which is a significant increase compared to the trend since the beginning of the summer to produce only 29-54% of the required amount. In November, the shortfall of 111 GWh was imported from neighbouring countries;
• Electricity prices in all three Baltic States remained the same in November, rising by 20% to EUR 105,20/MWh;
• In November, average electricity prices also increased in all other Baltic interconnected trading areas - in Finland by 85% to 69,68 EUR/MWh, in Sweden's Zone 4 by 139% to 73,55 EUR/MWh and in Poland by 3% to 98,38 EUR/MWh;
• Compared to the previous month, the volume of electricity imported to the Baltic States has increased by 2,2%. Electricity imports from Finland decreased by 10.4%, while imports from Sweden and Poland increased by 19,4% and 19,1% respectively;
• Several factors have contributed to the increase in electricity prices, one of which is the sharp increase in consumption in both Scandinavian and Baltic countries due to lower air temperatures, which has led to the need to use more fossil resources to generate electricity, which are more expensive and less efficient;
• The change in electricity prices was also driven by events in the Finnish trading area - the increase in prices in the Baltic States was due to the unplanned outage of Finland's largest nuclear power plant reactor Olkiluoto 3, from 19 to 22 November and in the last 2 days of the month. This outage reduced the share of nuclear capacity available to the Nordic countries, which in turn reduced overall flows to the Baltic States, resulting in an increase in electricity prices in the Baltic States during this period. The decrease in the Nord Pool system price is due to Kinect Energy's erroneous bid for the 24 November trading day, which resulted in 10 consecutive hours of the lowest possible hourly price in Finland - minus 500 EUR/MWh and a daily average price of - minus 203,40 EUR/MWh;
• By the end of November 2023, a total of 5 068 400 GOs have been issued in the Latvian Domain for GOs, which is 35% more than in the first 11 months of 2022.

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.

** Corrected historical data.

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

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

Balancing energy prices in the Baltic States

Highest and lowest bid prices

Total activated energy

Average hourly standard bid size

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, LBI - Lithuania-Belarus Import trade area, LRI - Latvia-Russia import trade area.

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.

** Corrected historical data.

*** 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 received into Latvian electricity grid are not commercial transactions, but electricity that has physically entered the network from other countries.

[3] Electricity transmitted from the Latvian electricity grid 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.