Electricity prices set new record in Sweden

March 6, 2010 by timbercommunity

The major cost items for many pulp companies are electricity and raw materials. Refineries that convert wood chips into paper pulp are large consumers of electricity since it is a complex process to separate the wood fibers. The spot price during February 2010 was almost 100% higher than the corresponding period in 2009.  Price trends in daily average in the Nordic countries and Germany during the peaked with over 500 Euro / Mvh.

Current situation clearly illustrates the dependence of Sweden is out of nuclear power which stands for over 40 percent of  the electricity generation. There are electricity shortages in Sweden in the mornings and evenings from 16 to 19. This winter had three extreme peaks in electricity prices on 17 December, 8 January and 22 February.

Price development in Sweden and Germany

Blue=EEX (Germany)
Yellow=System price (Nordpool)
Black=Swedish price (Nordpool)

Development spot price in Sweden 2008 and 2009
Öre/KwH (price)

Electricity-intensive Stora Enso in Kvarnsveden is the country's single largest consumer of electricity. By comparison, the mill annually consumes five times more electricity than all households in a city with 40 000 inhabitans. The developments in the Nordpool is followed closely by engineers at the mill. Kvarnsveden monitors hourly the price of electricity.

Anders Heldemar, energy manager Swedish Stora Enso, is not particularly worried about the high price of electricity and commented the high price to the paper Dalademokraten on February 25. - In the short term does not affect viability of that electricity prices shot up, he says. The cold has been the electricity price to rise sharply in the Nord Pool spot market. The daily average price fell to 5 per kWh and off hours, the price rose to almost 14 crowns." "The price of electricity affect the production marginally "says Anders Heldemar. The paper mill has contracts electric quotas and when the price is extreme, we sell back electricity to the Nordpool. It is a way to reverse the price situation to its advantage. But If electricity prices remain at high levels over a longer period it will have consequences.

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