Tuesday, June 18, 2024

Polaris of Enlightenment

Tuesday, June 18, 2024

Polaris of Enlightenment

Analysts optimistic about winter electricity rates

The energy crisis in Europe

Published 23 November 2023
- By Editorial Staff
In December 2022, a kilowatt hour cost almost three crowns at its peak.

Analysts expect winter electricity prices to be between 70 and 90 öre per kilowatt-hour. However, if it is very cold and windless, or if nuclear power is shut down, electricity prices could rise significantly.

– This year we have much better conditions than last year. The water reservoirs are well filled, the situation in Europe with gas storage is much better, the nuclear power is operational, which it wasn’t fully last winter. So the conditions are much better this year, Ann-Catrin Dahlbom, an electricity analyst at Elskling, told Swedish state broadcaster SVT.

Kaj Forsberg, a market analyst at the Swedish Energy Agency, also believes that the market is “more stable” this winter and predicts that the price differences between the four electricity areas will decrease in the future.

– If you look at December, you could say around 70 öre per kilowatt-hour, and you have to remember that last year the prices were two kronor and 70 öre. So there is a significant difference – and then we are talking about prices in electricity zones 3 and 4, and even lower in zones 1 and 2, says Johan Sigvardsson from electricity trading company Bixia.

– Looking further into the winter, the current indications are that it could be around 85-90 öre per kilowatt-hour, Sigvardsson continues, adding that this is roughly the cost of electricity in the first quarter of 2023.

Could be much more expensive

It should be noted, however, that the analysts’ forecasts are based on a “normal” winter – if instead it is windless or very cold, electricity prices could rise significantly.

If there is a situation like last year, where nuclear power plants are shut down or idled, that could also cause electricity prices to “skyrocket”, according to Dahlbom. An escalation of the situation in the Middle East could also affect Swedish energy prices.

It should also be added that the price per kilowatt-hour quoted by analysts is not what Swedish customers actually pay – this is always significantly higher due to various surcharges from electricity companies, fees and taxes.

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