Nordic electricity for next month declined to a record low after milder weather indicated reduced power demand in the region.
The February contract fell as much as 7.2 percent to 40.85 euros ($54.40) a megawatt-hour, and traded at 41.45 euros as of 2:16 p.m. on Nasdaq OMX Group Inc.’s energy exchange in Oslo. That’s the lowest for the contract since Nov. 6. The April through June contract dropped 2.4 percent to 36.45 euros after earlier falling to its lowest since Jan. 3.
Electricity use in the Nordic region can decline as the need for electric heating drops when temperatures rise from below-average toward the seasonal norm. Low temperatures in Oslo are forecast to rise to minus 5 degrees Celsius (23 Fahrenheit) on Jan. 27 from minus 19 one day earlier, according to CustomWeather Inc. data on Bloomberg. That compares with a 10-year average minimum temperature of minus 5 degrees.
The benchmark near-quarter contract could drop further as a result of milder weather, SEB AB, Sweden’s third-largest bank, said today in an e-mailed report.
The utilization rate among the Nordic region’s 14 nuclear stations, which provide a fifth of power use, was 96 percent at 7:34 a.m., according to calculations by Bloomberg and data from the operators.
Hydropower reserves in Norway and Sweden are 8.9 terawatt-hours below the seasonal average and may decline to a deficit of 12.3 terawatt-hours in two weeks, according to Markedskraft AS data on Bloomberg. The Nordic area, which gets more than half of its power supplies by running water through turbines, had a surplus of 9 terawatt-hours at the end of November.