Energy prices fall in Q3

Energy prices decreased in nearly all energy products in the third quarter of the year, according to the Statistics Finland.

Only the prices of domestic fuels and the consumer prices of electricity were higher than in the previous year.

The decline in the global oil price from the previous year was also reflected in the consumer prices of liquid fuels. Despite tax increases, the price of light fuel oil was almost five per cent lower in September compared to one year before. In September, the price of motor gasoline was two per cent lower and the price of diesel oil was on the same level as in the year before.

The tax-free prices of hard coal and natural gas used in energy production were 34 and 13 per cent lower respectively in September compared to the previous year. The taxation for combined heat and power production was changed from the beginning of the year. The halving of carbon dioxide tax was abandoned, but it was replaced with lower energy content tax for fuels used in combined production. The changes tighten the taxation of coal and lighten the taxation of natural gas in combined production. The taxable prices of coal and natural gas were respectively 11 and 6 per cent lower in September compared to one year earlier.

Prices of domestic fuels rose from the previous year. The taxable prices of forest chippings and milled peat were four and 12 per cent higher in September than one year ago. The price increase of milled peat was boosted by tax increases at the beginning of the year. Apart from peat and forest chippings, the prices of fuels for energy production have been falling.

In September, the system price of the Nordic electricity exchange derived from the sell and buy bids on the exchange was, on average, 31 per cent lower than one year previously. However, the fall was not reflected in full in the Finnish area price. In September, the average Finnish area price was only four per cent lower than the area price in September last year. During the past year, the hydro resources in the Nordic countries have normalised and the price level of emission permissions has stabilised.

In September, the electricity prices for household customers were around seven to nine per cent higher than in the year before, depending on the consumption category. Compared to the previous year, electricity prices for enterprise and corporate customers rose by two to 11 per cent, except for one consumption category. Household customers’ electricity prices are based on the obligation to deliver prices published by the Energy Authority. The obligation to deliver price reacts slowly to changes in electricity prices on the Nordic electricity exchange.