Nordic Next-Week Power Climbs to Record on Dry, Freezing Weather

Nordic electricity for delivery next week climbed to an all-time high as forecasts for drier, colder weather were poised to boost power demand and limit supply.

Power for next week gained 1.9 percent to a record 51.90 euros ($67.68) a megawatt-hour as of 3:30 p.m. on Nasdaq OMX Group Inc.’s energy exchange in Oslo. The month-ahead contract gained 0.3 percent to 47.45 euros, while power for the next quarter lost 0.7 percent to 37.75 euros.

Water reservoirs used for hydropower generation are being depleted faster than average so far this year, according to Danish energy trading company Energi Danmark AS.

“The winter is not half over yet, and what is traditionally the coldest part lies ahead,” Energi Danmark said today on its website.

Nordic water reservoirs were 67.8 percent full on Jan. 6, 0.3 percent point above the median for the period from 1990 through 2006 and 8.7 percentage points short of the year-earlier period, according to the Nord Pool Spot AS exchange.

The region’s hydropower reserves, which are 3 terawatt-hours below the seasonal average, may drop further to a deficit of 10.3 terawatt-hours in two weeks, according to Markedskraft AS data on Bloomberg. The region, which gets more than half of its power supplies by running water through turbines, had a surplus of 9 terawatt-hours as recently as the end of November.

Low temperatures in Stockholm are forecast to drop to minus 9 degrees Celsius (16 Fahrenheit) on Jan. 16 from minus 1 today, according to CustomWeather Inc. data on Bloomberg. That compares with a 10-year seasonal norm of minus 3.

Starting March 25, the Nasdaq OMX Group will offer yearly power contracts 10 years into the future as well as euro-denominated Norwegian-Swedish electricity certificates, the company said today in an e-mailed statement. Currently, the Nordic exchange offers yearly forward contracts for the next five years.

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