Enefit: Winter Electricity Prices Will Depend on Several Factors

As winter approaches, electricity exchange prices usually rise, but this does not automatically mean higher bills for every consumer. This is explained by a representative of the electricity supplier Enefit, who assessed what will influence electricity prices in Latvia during the cold season. Prices are set by the balance of supply and demand on the power exchange.

Why prices fluctuate in winter

Demand grows in winter because heating, lighting and everyday needs require more electricity. At the same time, the supply of cheaper renewable energy often falls, as there is far less sunshine than in summer. Wind becomes the main renewable source, but it delivers only if the wind actually blows and the region has enough wind farms.

If a prolonged spell of cold and calm weather sets in, as it did this January, demand has to be met from more expensive sources such as thermal power plants. If gas also becomes pricier and imports of cheap electricity are restricted, large price swings on the exchange are possible.

Imports and hydropower

Imported electricity is cheaper only if transmission from Scandinavia is not constrained by high local demand or interconnector disruptions. Moreover, in September, just before the active consumption season, water levels in Nordic hydropower reservoirs hit their lowest point in 30 years. As a result, hydropower plants are likely to have less capacity to offer cheap electricity on the market in the near term.

What it means for consumers

Another harsh winter could strain household budgets, while a mild, windy and rainy autumn and a windy winter would help balance supply and demand. The Enefit representative stresses that no single factor guarantees either a high or a low price; they are determined by all factors acting together. There is no reason to expect a new price crisis every winter, but it would be equally unfounded to assume electricity will definitely be cheap.

According to the company, the best deal on the electricity market can be found by knowing your own needs and habits well and choosing a contract type that fits them.