Finland · power · work in progress

Finnish electricity price model

A backtested wholesale price elasticity model for the Finnish (FI) bidding zone. Predicts day-ahead prices under demand shocks given hydrology, fuel costs, capacity availability, and cross-border flows. Backtest stress periods: COVID 2020, the 2022 gas crisis, OL3 commercial operation in April 2023, and the January 2024 cold snap. The calibrated merit-order model now fits post-OL3 hours at R²≈0.69 and reaches scarcity pricing; its elasticity is interactive below.

National HDD17 (latest)

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Norway reservoirs

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EUA carbon (latest auction)

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Brent (latest close)

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Scenario calculator

Build your own hour: shut OL3, make it calm or windy, move gas and carbon prices, drain the reservoirs, drop EstLink. The calibrated merit order re-clears in your browser and shows the resulting price.

post-OL3 R²=0.6918

Clearing price

€93

Marginal unit

Gas (CCGT)

Residual demand

5,524 MW

+10% demand →

+85%

Demand0%

Wind generation5703 MW

Gas price (TTF)32 €/MWh

CO₂ price (EUA)77.7 €/t

Nordic reservoirs65.7%

OL3EstLink 2SE import

Base: a cold 2026-01-08 peak hour (15,459 MW load). The calibrated merit order re-clears live as you move the levers; the toggles flip OL3, EstLink 2, and Swedish import capacity in or out of the stack.

From the calibrated merit-order model: the Finnish supply stack (hydro, biomass, peat, gas, coal, oil, and import blocks) is cleared against residual demand. It runs on a redistributable base hour (Fingrid generation + ENTSO-E neighbour prices) and derived model parameters — no republished raw prices. The model fits post-OL3 hours at R²≈0.6918 and reaches the scarcity pricing the earlier regression could not — try "OL3 out + cold calm."

Demand driver: heating degree days

Population-weighted national HDD17, daily mean over the last year. Winter peaks dominate Finnish electricity demand because of heating and heat-pump load.

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Source: FMI Open Data WFS (Helsinki Kaisaniemi, Tampere, Turku, Oulu, Jyväskylä Tikkakoski, Rovaniemi airport stations). National HDD computed as population-weighted mean across the six cities; weights are normalised regional populations from Statistics Finland.

Water value: Norwegian reservoirs

Aggregate Norge fill % vs the 20-year envelope. Norway holds ~87 TWh of the ~125 TWh Nordic hydro capacity and sets the floor on Nordic water value.

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Source: NVE Magasinstatistikk, NLOD/CC BY 3.0 Norge. Published every Wednesday at 13:00 CET. NO4 (Nord-Norge) is the reservoir region directly coupled to Finland via the FI-NO4 interconnector.

Fuel costs: carbon and oil

EUA carbon (per tCO₂, EEX primary auction clearing) and Brent crude (per barrel, EIA spot). TTF natural gas is the missing input — adding it depends on a free-source decision still pending.

TTF pending

EUA · last year of EU-wide auctions

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Brent · last year of daily closes

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EUA: EEX Primary Market Auction Reports. Full series since 2012-11-13. Brent: EIA Europe Brent Spot Price FOB (series RBRTE), public domain.

Cross-border interconnectors

Finland's transfer links to Sweden (SE1, SE3), Estonia (EE), Norway (NO4), and the dormant Russian tie. Every link is bidirectional; arrows and colour show which way power is flowing this hour.

flowing into Finland flowing out of Finland dormant (Russia)➤ direction · width ∝ MW · click a line for detail

Live physical flows from Fingrid Open Data (CC-BY 4.0). These links carry power both ways depending on prices and availability; the figures above are a single hour's net position, the way Fingrid reports it. Neighbour-zone day-ahead prices will be layered on next, now that the ENTSO-E feed exists.

Day-ahead prices

Nord Pool day-ahead clearing price for Finland and its neighbour zones. When the interconnectors have headroom the zones couple to one price; when a link binds, prices split.

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Source: ENTSO-E Transparency Platform day-ahead prices (redistributable). The chart is Finland's daily-mean price over the last weeks; the cards show the latest hour per zone.

Why supply can't respond quickly

The steep end of the elasticity curve exists because the stack is fixed in the short run. New wind and grid take years to permit and build, so a tight hour has no fast supply answer.

Wind farms

Municipal zoning runs several years (developer-funded), plus an environmental impact assessment.
No one-stop-shop: several permits, each with its own appeal route.
Defence Forces radar clearance — turbines typically ≥40 km from a sensor, more depending on height and direction. A real siting bottleneck.
The 2025 Building Act adds a "clean transition placement permit" meant to let building permits proceed without a finished zoning plan.

Grid

Connecting large new load in southern Finland is tight 2025–2027; new grid-storage connections restricted there until 2029.
Fingrid is investing ~€1.7bn in 2025–2028 and ~€4bn over the decade.
Key links land late: Lowlands Line 2027–2028, Alajärvi–Hausjärvi 400 kV 2028–2029.
The Aurora Line (FI–northern Sweden, 400 kV) only came online in November 2025.

So the merit order the calculator clears is, for any given hour, essentially fixed: a cold calm evening with a reactor out cannot summon more capacity, which is why the price goes vertical. Sources: Renewables Finland and the Finnish Defence Forces (wind permitting and radar consultation), Fingrid main-grid development plan and southern-Finland connection notices, and the 2025 Building Act reform.

Structural events

Discrete supply-curve shifts the model treats as exogenous regime flags.

Olkiluoto 3 (OL3)

2023-04-16

1600 MW · nuclear · Teollisuuden Voima Oyj (TVO)

OL3 EPR reaches commercial operation. Adds ~14 TWh/year of near-zero-marginal-cost baseload, structurally collapsing Finnish day-ahead prices and flipping FI from net importer to often net exporter.

Olkiluoto 3 (OL3)

2022-03-12

1600 MW · nuclear_test · Teollisuuden Voima Oyj (TVO)

OL3 first grid synchronisation. Test power production began but operation was intermittent and below nameplate until commercial date.

Estlink 2 · outage

2023-12-26 → 2024-09-03

650 MW · Fingrid + Elering

Submarine cable fault, exact cause undetermined at outage start; later associated with the Newnew Polar Bear vessel anchor drag incident. Reduced FI-EE transfer capacity from 1000 MW (Estlink 1 + 2) to ~350 MW (Estlink 1 only). Notably tight during January 2024 cold snap.

Estlink 2 · outage

2024-12-25 → 2025-08-12

650 MW · Fingrid + Elering

Cable severed by anchor drag of tanker Eagle S (part of Russia-linked shadow fleet). Repair lifted in stages. Repeat Estlink 2 loss. Coupled with winter 2024-25 cold spell heightened FI dependence on Swedish imports and OL3 availability.

Russian electricity imports

cutoff 2022-05-14

Typical pre-cutoff: ~1300 MW · ~8 TWh/yr (~9.5% of FI consumption)

Inter RAO (Russian state-owned operator) announced on 2022-05-13 the suspension of electricity exports to Finland effective 2022-05-14, citing non-payment under sanctions. The decision was taken in the context of Finland's NATO application, announced 2022-05-15.

Pending inputs

Fingrid (load, generation, flows) and ENTSO-E (day-ahead prices) are now live and feed the map and price panels above. These feeds remain on the list.

in progress

TTF natural gas (daily)

Blocked on: Public daily source decision pending

Coming

· Needed for the live-conditions calculator (gas/coal marginal cost)
· World Bank monthly already stitched in for history
· Daily: EEX TTF NGP accumulating forward, or a public daily series

API2 coal (monthly)

Blocked on: Lower priority

Coming

· Used for 2015-2021 model fit only
· Source: EMBER Climate monthly or EU QR coal annex

Methodology

The model is a thin merit-order forward stage (nuclear → wind/solar → hydro at water value → biomass and CHP → gas → coal → peakers) with the residual fitted by gradient boosting on the input vector. The forward stage gives an interpretable supply curve at each hour; the residual picks up strategic bidding, demand response, and reserve-market spillover the forward stage cannot model.

Backtest design: train on 2015-2019 (calm regime), test on 2020 (COVID), 2022 (gas crisis), 2023 (OL3 commercial), and the January 2024 cold snap. Each test period gets a separate confidence flag in the calculator UI.

Honest limits: hindsight bias is avoided by using ENTSO-E day-ahead forecasts (document A89) as the model's expected wind / solar / load input rather than realised values. Norwegian reservoirs alone capture Nordic water value; Swedish and Finnish hydro variance is absorbed in the residual. TTF gas is the single most material missing input for the 2022 stress test, and the page will warn when the model runs on interpolated monthly TTF.