25 August 2026 | ANTTI LEHMUSKOSKI, SOLNET GROUP
As a result of this price increase, electricity bills for companies buying spot-priced electricity have risen significantly. According to Nord Pool day-ahead prices, the average spot price for January to June 2025 was 38.7 EUR/MWh. In the same period in 2026, the average price rose to 71.7 EUR/MWh, an increase of roughly 85 percent.
For a company purchasing spot-priced electricity, this kind of volatility is a risk. When energy costs nearly double within six months, budgeting and profitability calculations become uncertain. This is especially relevant in industry, logistics and cold-chain operations. Such a sharp rise in spot electricity prices also feeds through, with a delay, into hedged or fixed-price electricity contracts.
Several factors have contributed to the price increase at the same time:
1. Growth in electricity consumption:
According to Finnish Energy, Finland's electricity consumption in January to June rose by around 7%. From an economic and GDP perspective, this growth in consumption is a positive sign. It suggests that the Finnish economy, and industry in particular, is picking up. Beyond industry, another significant driver of consumption growth is the electric boilers used by district heating companies (Source in Finnish). Data centres' share of electricity consumption is not yet significant; that will only become visible in the coming years, once the data centres currently under construction are completed.
2. Cold, calm weather in January and February:
A long cold spell early in the year drove up demand for heating electricity considerably. According to Finnish Energy (Source in Finnish), Finland set an all-time record for electricity consumption in January 2026, at 9.6 TWh for the month. In addition to home heating, district heating companies' electric boilers consumed large amounts of electricity early in the year, at least whenever spot electricity prices were low.
3. Exceptionally low wind power production:
In January, February and April, wind power output was lower than usual (Source in Finnish). Finland's electricity market is now strongly dependent on wind power availability, which made low wind output one of the factors pushing up spot electricity prices earlier in the year.
4. Historically low hydro reservoir levels in the Nordics:
Weak availability of hydropower has reduced the amount of flexible balancing power on the market. Reservoir levels remain below average across Scandinavia (Source in Finnish), even though Finland itself has had an unusually rainy summer. Because Finland's electricity market is closely linked to Swedish and Norwegian hydropower, low reservoir levels could keep spot electricity prices higher than usual into next winter as well.
5. The shared Nordic market and European influence:
Finland is part of the Nordic electricity market, so price fluctuations elsewhere in the Nordics also affect prices here. The Nordic market is in turn connected to the wider European market, where higher natural gas prices have also pushed up electricity prices. These effects extend all the way to Finland.
6. Geopolitics:
We are living through a continuous period of crises. Over the past year, the United States' conflict with Iran in particular has driven up energy prices. There is a direct link between natural gas prices and electricity prices in Europe. If the situation in the Strait of Hormuz is not resolved, natural gas and crude oil prices are likely to rise further, which will in turn push up electricity prices in Finland too.
7. Fossil fuel and emission allowance prices:
Higher costs for gas and coal-fired power, together with EU Emissions Trading System allowance prices, raise the market's marginal price during cold, low-wind periods. If geopolitical instability continues, fuel prices are likely to remain elevated.
It is impossible to predict electricity prices years or decades into the future. However, several factors in the development of Finland’s electricity consumption could significantly increase electricity demand in the coming years.
According to Fingrid’s forecast, Finland’s electricity consumption could increase from the current level of around 86 TWh to 104–159 TWh by 2035. The scale of the increase will depend particularly on Finland’s ability to attract electricity-intensive investments. The main sources of growth include data centres, hydrogen and e-fuel production, and other industries. At the same time, heating and transport are becoming increasingly electrified.
This growth is not just a long-term forecast. By mid-August 2026, data centre projects that had already signed grid connection agreements had a planned total capacity of nearly 5 GW. The combined capacity of electric boiler projects under construction and already in operation had exceeded 3 GW. If all consumption projects that have already signed grid connection agreements are fully realised, they would increase Finland’s electricity consumption by nearly 40% compared with 2025 levels. Much of this capacity is not yet reflected in electricity consumption, and its impact will grow as these projects are completed.
For companies, the key is therefore not to try to predict what electricity will cost next winter or next year. It is more important to keep the longer-term megatrends in mind. Electricity demand and the generation mix are undergoing significant changes, and price volatility will remain a feature of the electricity market. By investing in their own solar power and battery storage, companies can protect part of their electricity procurement from market price uncertainty for decades.
Spot electricity prices are structurally exposed to rapid changes. Longer-term price shifts also feed through, with a delay, into fixed-price electricity contracts and hedging costs. Over a six-month review period, spot electricity prices were nearly double what they were a year earlier. Over such a long period, this is not an isolated event but part of a longer-term trend.
A company that produces part of its own electricity significantly reduces its exposure to market risk. A solar power plant generates most of its electricity during the day for most of the year, which is typically when companies' own consumption is highest. This makes energy costs more predictable, provides better protection against price spikes, and gives a more stable basis for profitability calculations. A battery energy storage system (BESS) can further improve the time-shifting of electricity use.
Investing in a company's own solar power plant and battery energy storage system is also a long-term decision. A solar power plant produces electricity for decades, and its production cost is known in advance, unlike the spot electricity price. For companies with large roof areas, energy-intensive operations, or high daytime consumption in particular, self-generation is a practical way to manage price risk.
Contact us: Let's go through how a solar power plant and battery energy storage system can reduce your company's exposure to electricity price volatility.