Electricity prices in southern Sweden have fallen to around 30–40 öre per kilowatt-hour. Problems with international power lines have limited exports and contributed to lower prices for Swedish electricity customers.
Electricity prices have fallen sharply following this summer’s price spikes. Strong winds have increased production, while problems with several international transmission lines have reduced the ability to export Swedish electricity, reports TV4.
One of these interconnections is the Baltic Cable between Sweden and Germany. When export capacity is limited, more electricity remains in the Swedish market, and demand from abroad decreases.
The expert highlights the effect
Mats Nilsson, an associate professor of economics at Södertörn University, highlights the importance of exports for prices in southern Sweden.
– Our exports are driving up demand, which in turn is causing prices to rise in electricity zone four.
Nilsson is critical of how the electricity market affects Swedish electricity customers. He believes that households and businesses are being forced to pay a premium to help countries such as Germany and Denmark.
– I find this troubling because it clearly indicates that our foreign trade does not benefit Swedish consumers at all.
A costly winter may be ahead
According to Nilsson, low water levels and restored international transmission lines could contribute to higher winter prices. At the same time, today’s price drop shows how export capacity can affect Swedish consumers’ electricity bills.
Energy efficiency, battery storage, and demand response can reduce households’ vulnerability. These developments also raise the question of how the electricity system can be designed to ensure stable prices and a secure Swedish energy supply.
It would be best if someone blew up the cables or dragged an anchor over them—after all, if they were able to blow up the gas pipelines to Germany, then it should be easier to blow up the cables.