Fortum's energy market review: Electricity consumption an...

Fortum's energy market review: Electricity consumption and wholesale prices have decreased in the Nordic market

The impacts of the global economic slow-down on the electricity market can now be seen as a decrease in the demand and prices of fuel and electricity. Wholesale electricity prices on the Nordic market have been going down for almost half a year. On the financial market, the prices for electricity futures have decreased to levels last seen over three years ago. On the other hand, the physical spot market prices are higher than in the beginning of 2007.

- At the same time as the fuel prices have decreased, also electricity consumption has declined. Even during cold winter days there have not been significant increases in the spot prices. Normally, a hydro balance this weak would have resulted in a price peak, comments Fortum Power Generation's Lotta Forssell, Vice President, Communication.

Fortum publishes a topical energy market review two to four times a year. The topics covered in the review include for example fuel price development, electricity price development on the Nordic power market and factors influencing these.

Summary of the energy market review on 23 February 2009:
- The global economic slow-down has had an impact on the demand and price of fuel and electricity.
- Electricity consumption has decreased significantly in late 2008. In the Nordic market, the demand declined about 5 TWh during the last quarter of 2008 compared to the previous year.
- Fuel prices on the international markets decreased dramatically during the second half of 2008. After the turn of the year, the prices stabilised temporarily, but have again been sliding during the recent weeks.
- Prices for emission allowances have plummeted. The price is now about EUR 10 per tCO2, compared to about EUR 21 per tCO2 a year ago.
- Nordic wholesale electricity prices have decreased significantly since autumn 2008.
- The Nordic water reservoirs are slightly below the long term average.
- Continental European prices are EUR 10-20 MWh higher compared to Nordic prices.