We are planning to introduce seasonal pricing for district heating – The change mainly concerns businesses and housing companies

Vaasan Sähkö is planning a change to the district heating pricing model, intended to take effect on 1 January 2027. The change mainly concerns businesses and housing companies. Read this article to find out what we currently know about the change.

In the future, customers will be able to choose between two alternative pricing models.

In the primary option, heat energy will be priced quarterly, meaning four times a year. As an alternative, a new heating product will be offered where the energy price remains constant, but the share of the fixed basic charge is higher.

The change applies to customers whose basic charge is based on water flow billing. Customers with a heating capacity of less than 17 kW, typically detached houses and small semi-detached houses, will not be affected by the change.

What will change?

Until now, the energy price for district heating customers has remained the same throughout the year. In the new pricing model, the price will reflect seasonal temperatures and heating needs: the price will be lower in summer and higher in winter, when it is colder outside.

The seasonal price product will become the primary product for district heating customers. Alongside, we will still offer a product where the energy price remains the same throughout the year and where the basic charge is higher than in the seasonal product.

In the fixed-price product, the district heating company carries the weather risk of a potentially cold winter, which is why the basic charge is higher.

The fixed-price product will be available on separate request. The weighting of the different price components in the fixed-price product will change from the current model so that this product, too, will give customers better opportunities to save energy and money.

Why are we making this change?

Lower electricity prices in summer are encouraging district heating customers to acquire a parallel heating solution for the summer months, which means that part of the district heating volume is left unused.

This, in turn, increases the costs of district heating when some customers use it only when production is at its most expensive. In the long run, this trend increases the price of district heating for all customers in the network.

Seasonal pricing therefore also ensures that pricing reflects the actual production costs of district heating.

We have sought to find a solution that gives customers more opportunities to save.

Who will be affected by the change?

The change applies to properties whose current basic charge is based on water flow billing. These are mainly businesses, housing companies, and public buildings.

Seasonal pricing will not apply to detached houses and small semi-detached houses, because their basic charge is determined based on actual energy use.

Seasonal pricing is intended primarily for customer groups whose cost structure is significantly affected by seasonal changes in heat use and the use of alternative heating solutions. Detached houses and small semi-detached houses form a separate customer group for which the current pricing model has been assessed as appropriate.

What will the new pricing look like?

Seasonal product prices will be decided later this autumn. Once the decision has been made, we will inform customers without delay.

We estimate that prices will average about 20 percent higher in winter and 20 percent lower outside the heating season compared with the current fixed pricing model.

The prices for all quarters will be announced at the same time, one year at a time.

FAQ

How will customers benefit from the change?

The change will give customers better opportunities than before to influence their own heating costs. Investments in energy efficiency and optimizing consumption, especially during the winter season, will be reflected more clearly in costs.

Seasonal pricing also encourages more even heat use, which reduces consumption peaks. This allows the entire district heating system to operate more efficiently and reduces the need to start expensive peak production, helping to keep the energy price lower.

In addition, the purpose of the change is to ensure that district heating remains a competitive option for customers. Seasonal pricing ensures that the pricing reflects the actual production costs of district heating.

Why is the district heating pricing model changing?

District heating pricing is being changed so that pricing better reflects the actual costs of heat production in different seasons. Heat production is more expensive in winter than in summer.

The aim of the change is to ensure that district heating remains a competitive and attractive heating solution for customers in the long term. Lower electricity prices in summer have increased interest in various hybrid systems where district heating is used mainly in winter. In such cases, district heating consumption peaks precisely when production is at its most expensive, increasing the costs of the entire system.

With the change, costs will be distributed within the year in a way that better reflects costs. At the same time, they will be allocated more fairly between customers.

Seasonal pricing may also help even out consumption peaks and reduce the need to use the most expensive forms of peak production during very cold weather. This supports the efficient operation of the entire district heating system and reduces dependence on expensive reserve production.

When will the new pricing model take effect?

The new pricing model will take effect on January 1, 2027.

Why is the price higher in winter than in summer?

District heating production costs rise in cold weather, when more heat is needed. During very severe cold spells, heat production must be supported with peak production plants, which are more expensive to operate than other production. In summer, lower heat demand makes production cheaper.

How can my business or housing company influence district heating costs?

You can influence district heating costs by reducing unnecessary heat consumption, especially during the winter season when heat production costs are at their highest.

For example, optimising indoor temperature, improving the energy efficiency of the property, and adjusting heating and ventilation appropriately can reduce the need for heating energy. Under seasonal pricing, the impact of savings is particularly pronounced during the periods when heat production is most expensive.

When and where will the energy prices be published?

Energy prices will be published on our website, and customers will be informed of them at least one month before the new prices take effect. The prices for the full year will be published at the same time.

Will the heating costs of my business or housing company increase?

The purpose of this change is not to increase customers’ average costs. Instead, costs will simply be distributed differently within the year.

Will my company’s/housing company’s agreement continue as before, or do I need to do something?

You do not need to do anything about the agreement. Agreements included in the new seasonal pricing model will automatically be changed to seasonally priced agreements.

Pricing for customers outside the scope of the change will remain unchanged. This also includes customers covered by reserve capacity pricing.