Overview of the energy market: The race to use the wind potential of the Baltic Sea is on

European countries are looking for ways to simultaneously increase the share of green energy and their energy self-sufficiency. Finland, which wants to have offshore wind farms with a total capacity of 6 GW by 2030, took a remarkable step.

Pricing area

Average exchange price

Change (last week)


86,5 €/MWh



86,5 €/MWh



87,0 €/MWh



82,8 €/MWh


Last week the electricity price in Estonia was on average 86.5 €/MWh (+14.1 €/MWh compared to the previous week). Electricity was the most expensive last Wednesday morning at 8:00, at which time the price was 148 €/MWh. The cheapest hourly price was 42.88 €/MWh, recorded on Saturday 8 April at 1:00.

The price of electricity increased last week in the entire Baltic and Finnish pricing area. This was primarily affected by increased fuel prices and up to 65% less wind energy production at times. The Olkiluoto 3, which is in test mode, operated part of last week at a reduced load, but is now back to maximum capacity. The average weekly price of natural gas remained at 46.4 €/MWh, which is 3.5 euros more than the previous week.

The race to use the wind potential of the Baltic Sea is on

In the context of Europe, the pension reform strikes in France continued to be a major factor, leading to some plants operating at limited capacity.

The amount of green energy in the Baltic Sea region should significantly increase by the end of the decade, solely due to Finland’s contribution. This year and at the beginning of 2024 the state-owned company Metsähallitus will call for tenders for the construction of 5 new offshore wind farms with a total capacity of 6 gigawatts. The wind farms should be completed by 2030. Metsähallitus organised the first such auction late last year, auctioning 1.3 gigawatts of offshore wind farm capacity near Vaasa, which was won by Swedish developer Vattenfall. Offshore wind farms totalling 13 gigawatts are currently being planned in Finland. However, the capacity of offshore wind farms operating today is still relatively low at 73 megawatts.

By comparison, Finland has onshore wind farms with a total capacity of 5.5 gigawatts. In terms of profitability, the first offshore wind farms appeal to developers the most, as they can get a higher price from the electricity market. Because the wind in the Baltic Sea blows similarly everywhere, each subsequent wind farm will decrease the average electricity price and thus the revenue. The construction of more and more wind farms may also lead to an oversupply of electricity at some point, but this would open the door to new storage technologies, such as batteries, pumped storage hydropower and hydrogen electrolysis.

The decision of OPEC keeps the oil price high

The surprising news regarding the oil cartel OPEC+ production cut shocked financial markets and forced the price of oil to its highest this year at 85 dollars per barrel, however market participants disagree about the long-term impact of this decision. While several banks have increased their forecast for crude oil prices to 100 dollars per barrel by the end of the year, many traders believe that the languishing world economy will suppress price increases and consumption will not recover at the expected rate.

OPEC+ will limit production starting May, which means that its impact on oil supply will show in the second half of the year. On the one hand, this is the peak summer holiday season in United States, and the Chinese economy should fully open up. However, traders believe that OPEC+ may not be certain about increasing consumption, as it would be illogical to reduce production when demand is high. Due to the OPEC+ decision and the decline in US supply, the price of crude oil increased for the third week in a row and is now 26% higher than the low point in mid-March, when the price was affected by alarming news from the banking sector.

European CO2 emissions decreased contrary to expectations

The CO2 emissions of the industry participating in the European CO2 market fell last year by nearly 1.2%. This was a surprise to analysts, who had rather been expecting a slight increase, as last year’s high gas prices led many coal plants to produce electricity again instead of gas power plants. However, CO2 emissions from coal plants are twice as high compared to gas plants. In contrast, significantly higher reductions in the CO2 emissions of other European processing industries in the CO2 market were surprising. Thus, the CO2 emissions of the heavy industry, for example, fell by nearly 8% in a year.

The average weekly price of CO2 is 96 € (+6 €/t compared to the previous week). The price of an emissions allowance rose to a three-week high, continuing the upward trend of the last period. The main reason for the upward trend is the redemption deadline for last year’s CO2 emissions allowances for the industry at the end of April. Those who do not yet have the necessary number of EUAs can still purchase them on the market.

The Narva stations of Eesti Energia provided up to 266 MW to the market last week. The 3rd energy block of the Eesti power plant is under maintenance until May and the 4th energy block is undergoing annual maintenance until September.

The price of electricity is formed per hour based on the exchange price, depending on the production capacity and consumer demand in each particular hour, as well as interstate limitations on transmission capacity.

Olavi Miller, Market Analysis Strategist at Eesti Energia

The market overview has been compiled by Eesti Energia according to the best knowledge currently available. The information provided is based on public information. The market overview is presented as an informative material and not as a promise, proposal or official forecast by Eesti Energia. Due to rapid changes in the regulation of the electricity market, the market overview or the information contained therein is not final and may not correspond to future situations. Eesti Energia is not liable for any costs or damages that may arise in connection with the use of the information provided.