Lack of wind and cold weather increases market prices: what shall the electricity user do?
The electricity market price on the stock exchange is much higher than usually at the beginning of the year. We will explain why the prices have increased, which users are the most affected ones and how to protect yourself from the high stock prices best.
Since 2007, here in Latvia we have been purchasing electricity on the free market, where its price is determined by the relationship between supply and demand on the Nordic and Baltic power stock exchanges. The average stock exchange price in January this year was 53.54 € / MWh, which is a 19% increase compared to December (44.86 € / MWh) and a 30% increase compared to the average market price in November (41.10 € / MWh).
The price increase is explained by the increase of consumption and insufficient wind power capacity in the Nordic and Baltic regions. The electricity market in the neighbouring countries depends mainly on the strength of the wind, as significant part of the energy is produced by wind generator farms. Therefore, if the wind is moderate, it also directly affects the price of electricity in the price region of Latvia.
As the consumption at many homes and enterprises has increased due to increased heating during cold weather, these changes, together with the high stock market price, will have a significant impact on electricity bills.
Which users are affected by the high stock exchange price?
The higher stock exchange price currently affects those users who have chosen the Dynamic product, because in this case the electricity bill is determined by the current market price. If you have chosen the Dynamic product, you can adjust your electricity consumption by following the prices on the stock exchange to spend more during hours when prices are lower and reduce your consumption through those hours when prices are higher.
The customers of Enefit can see the current electricity prices on the stock exchange in the Enefit mobile application. Many customers who have connected to the market-linked tariff use this information to plan the operations of household electrical appliances (washing machine, boiler, electric heater), adjusting it to the hours when the price of electricity is most advantageous, and thus saving money.
How to protect yourself from the high prices of the market?
If you do not want to change your consumption habits according to the current market price, there is another way. Fortunately, electricity is one of those products where price can be fixed for a longer period of time, such as two years. If you have chosen a fixed price tariff, you will be protected from price changes on the stock exchange, and the risk of price increase will be covered by the trader.
On our website you can find information about the offered tariffs for electricity. If you want to change your tariff today, you can easily do so on our customer portal. Switching from Dynamic product to the Fixed price product is free of charge.