Electricity market review: Autumn 2026

Read the summary

• Market expectations for electricity prices in the fourth quarter are clearly higher than a year ago.
• Hydroelectric reservoir levels remain below normal.
• European natural gas storage levels are historically low, and the winter target levels will not be reached.
• High price levels in Central Europe are also reflected in Nordic and Finnish prices through transmission connections, especially during periods of low wind power generation.
• The situation in the Strait of Hormuz is affecting fuel prices and creating uncertainty in the market.

Due to the very low rainfall this year, hydroelectric reservoir levels in the Nordic countries are low, and spot prices particularly in Southern Norway have been significantly higher this year than in recent years because of the weak hydrological situation. This has also pushed up prices elsewhere in the Nordic region.

The water in the hydroelectric reservoirs in the Nordics currently equal up to about 13 terawatt-hours (TWh) less than normal, which is equivalent to the annual electricity production of Finland’s largest nuclear power plant, Olkiluoto 3.

In addition, annual maintenance at Sweden’s nuclear power plants was delayed, and Swedish nuclear power production this summer was the lowest in fifteen years.

The war between the United States and Iran has continued throughout the summer. Peace negotiations have taken place, but without a resolution, due to differing views on the parties’ conditions.

The war has had a major impact on fuel prices, and the closing of the Strait of Hormuz to traffic has disrupted one-fifth of the world’s natural gas and oil exports.

However, the price of oil has fallen significantly from its peak levels, although further price increases are still possible.

High fuel prices have mainly been reflected in electricity prices in Central Europe, where power generation is highly dependent on natural gas and coal. European natural gas storage levels are also weak, at only about 61%.

Storage levels are about 13 percentage points lower than at the same time last year, and the target levels for the coming winter will not be reached.

Low storage levels in winter increase electricity prices and the risk of shortage in gas availability if the winter is colder than usual. Very hot periods in recent weeks have also forced France to temporarily shut down some of its nuclear power plants, pushing price levels even higher.

High price levels in Central Europe are also reflected in the Nordic system price through transmission connections, affecting Finland as well, especially during periods of low wind power generation.

Loviisa 2 is currently undergoing annual maintenance, and Olkiluoto 3 will enter maintenance shortly before mid-September. Loviisa 1 will then follow after maintenance on the other unit has been completed. Nuclear power plant maintenance has a significant impact on Finland’s total electricity production, and during maintenance periods, prices therefore fluctuate sharply depending on wind power generation.

The expected rise in price levels is also visible in derivative prices, and quotations for Finland’s area price particularly in October are high compared with realized prices in recent months.

In the derivatives market, the elevated price level continues until next spring.

Derivative quotations for Finland’s area price are about €91/MWh for the final quarter of the year and about €98/MWh for the first quarter of next year. A year ago, derivative quotations for the corresponding periods were about €53/MWh and €72/MWh, respectively, when a stronger hydrological situation and significantly cheaper fuels made a lower price level possible. Last year, maintenance at Olkiluoto 3 also took place in the spring rather than in the fall.

Summer rainfall has been at a normal level, but because fuel prices have remained high, market expectations in August for the price level in the final quarter are about €20/MWh higher than they were at the beginning of the summer.

This market analysis has been produced in cooperation with Power-Deriva Oy.