Latvian electricity prices more than double in early November

Wholesale electricity prices in Latvia have risen sharply at the start of November. Over the first five days of the month the average price was 255 euros per megawatt-hour (MWh), more than double the October average. The explanations come from AST, the state-owned, independent operator of Latvia's electricity transmission system.

What drove prices up

AST representative Junghāns says the steep rise in early November was seen across Europe. The main cause, he says, was the increase in international natural gas prices linked to the conflict involving Iran. More expensive gas raises the cost of generating power at thermal plants, which are needed in colder weather to meet growing demand and to make up for reduced renewable generation.

Junghāns notes that Latvia's largest gas-fired power plant, Riga CHP-2 (Rīgas TEC-2), has been operating since the end of October. In October, solar and wind farms in the Baltic region supplied 40% of the electricity consumed, but so far in November they have provided only 20%.

Imports and interconnections

So far in November the Baltic states have imported a third of the electricity they need from the Nordic market, where prices are lower, especially in Finland. However, interconnector capacity is insufficient to fully replace expensive thermal generation. Junghāns stresses that this again shows the Baltic region's need for additional competitive renewable generation capacity.

Daily prices

According to the Nord Pool power exchange, the average price in Latvia's trading area was 233 euros per MWh on 1 November, 347.29 euros on 2 November, 308 euros on 3 November and 280.21 euros on 4 November.

AST group's turnover last year was 355.824 million euros, up 37.6% on 2024, while profit rose 29% to 29.252 million euros.