Nordic electricity prices rose as weather forecasts pointed to increased power demand and lower supply.
The contract for next quarter gained as much as 1.6 percent to 36.05 euros ($48.70) a megawatt-hour on Nasdaq OMX Group Inc.’s energy exchange in Oslo, and traded at 35.85 euros as of 10:12 a.m. Power for delivery next month traded at 41.15 euros after rising as much as 1.5 percent to 41.30 euros.
Low temperatures in Oslo may drop to minus 15 degrees Celsius (5 Fahrenheit) on Feb. 3, from zero today, according to CustomWeather Inc. data on Bloomberg. Temperatures are poised to drop to as low as minus 23 degrees on Feb. 10. Cold weather boosts demand for electric heating.
Nordic water reservoirs were 60.8 percent full on Jan. 20, representing production of 73.8 terawatt-hours, according to the latest data from the Nord Pool Spot AS exchange in Oslo.
“We expect water reservoirs to lose roughly 7.5 percent of their content through this week and next, which is a lot more than usual for this time of year,” as a result of surging electricity demand, Danish energy trading company Energi Danmark A/S said today in an e-mailed report.
Drier weather forecasts indicate that the region’s hydrological balance, the amount of water and snow available to generate electricity, may be 12 terawatt-hours below the seasonal normal in two weeks, with the deficit increasing 14 percent from today, Markedskraft AS data on Bloomberg show. The Nordic region meets more than half its power needs by running water through turbines, which means lower rainfall affects supplies and electricity prices.
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