Electricity prices in Finland can change dramatically from day to day. The main reasons are weather conditions, changes in energy production and fluctuations in demand on the Nordic electricity market.
For consumers, this can mean large differences in electricity prices depending on the time of day, the season and the overall supply of power in the region.
Part of the Nordic electricity market
Finland is part of the Nord Pool electricity exchange, which connects the power markets of several Nordic and Baltic countries.
Electricity prices are set on the market based on supply and demand. Power producers offer electricity to the market, and the price is determined by the most expensive production needed to meet demand at a given time.
Because the Nordic countries share the same market, electricity prices in Finland are influenced not only by domestic production but also by conditions in neighbouring countries such as Sweden, Norway and Estonia.
Weather plays a major role
Weather conditions are one of the biggest factors affecting electricity prices in Finland.
Cold temperatures increase electricity consumption because more power is needed for heating. During particularly cold winter periods, demand can rise sharply, pushing prices higher.
At the same time, weather also affects electricity production. Hydropower production depends on water levels in reservoirs, while wind power output depends directly on wind conditions.
Rapid growth of wind power
Wind power has expanded rapidly in Finland in recent years and now plays a significant role in the country’s electricity production.
When wind conditions are favourable, large amounts of electricity can be generated at a very low cost. This can push market prices down, sometimes dramatically.
On very windy days, electricity prices may even fall close to zero for short periods.
However, when wind production drops during calm weather, other and often more expensive power sources are needed to meet demand.
Nuclear power stabilises supply
Finland also relies heavily on nuclear power, which provides a stable base level of electricity production.
The country’s newest nuclear reactor, Olkiluoto 3, began regular production in 2023 and significantly increased Finland’s domestic electricity supply.
Stable nuclear production can help reduce price volatility, although it does not eliminate fluctuations entirely.
Demand peaks during winter
Electricity consumption in Finland is highly seasonal. Demand is typically highest during the coldest winter months when heating needs increase.
In contrast, consumption is usually lower during summer, which often leads to lower electricity prices.
The bottom line
Electricity prices in Finland fluctuate because they are determined by a market where supply and demand change constantly.
Weather conditions, wind power production, nuclear output and electricity demand all play a role. As renewable energy production continues to grow, short-term price fluctuations may become even more common — but overall supply is also expected to increase.
