Curve about the worst day in the history of Lithuanian electricity: a paradoxical situation occurred

On Wednesday, D. Kreivys, visiting the meeting of the Labor Party faction in the Seimas, said that Tuesday was “the worst day in the history of Lithuanian electricity”, because the average price of electricity on the Nord Pool exchange on Wednesday reached 823 euros per megawatt hour.

“The price could have been a little lower, but our generator in Elektrėnai is very powerful. When the high-power generator turns on, the stock exchange rejected his offer yesterday,” D. Kreivys told reporters on Wednesday.

The minister explained that the Lithuanian generation “Nord Pool” was rejected due to the “paradox” of the algorithm used in the exchange.

“When a huge amount arrives at a lower price on the market at that time, that amount lowers the price to such an extent that its offer becomes more expensive than the market,” said D. Kreivys.

He said that such a “paradoxical situation” occurs about once a year under normal conditions, but with energy prices as high as they are now in Lithuaniait started recurring every month.

“The bottom line is that a huge amount of electricity, if the need for it is less, is unacceptable. Then another one (another supplier’s offer – ELTA) is accepted, which has a higher price and can produce less,” said D. Kreivys.

According to the minister, the State Energy Regulatory Council (VALUE) was asked to investigate the situation in cooperation with Nord Pool’s regulator, the Agency for the Cooperation of European Energy Regulators (ACER).

According to D. Kreivis, this issue was raised with ACER earlier, but he refused to change the algorithm. However, the minister hoped that the exchange algorithm could be changed to make it more favorable to the Baltic countries.

“This is a European-level regulation, an algorithm. It is calculated and determined by ACER, the union of all European regulators. It is impossible to change the algorithm itself, but perhaps some instruments can be coded in the algorithm, so that the paradox that exists without changing the essence of the algorithm could somehow work differently”, said D. Kreivys.

“When a paradox occurs every two or one month, it is no longer a paradox,” emphasized D. Kreivys.

According to the minister, the Lithuanian reserve power generation unit participates in the market and offers electricity constantly, but they are not always accepted due to the too high price or too large amount of electricity offered.

D. Kreivys also noted that high electricity prices in Lithuania were caused by limited electricity supply connections with Latvia and Estonia, resulting in less electricity coming from Finland, limited by high temperatures “NordBaltconnection with Sweden, and the connection with Poland was also out of power for several hours.

On Tuesday, D. Kreivys turned to VERT, asking it to investigate whether the regional electricity trade exchange does not reject the price offers of Lithuanian electricity producers, the price of which is significantly lower than the final price of electricity formed on the exchange, he reported Ministry of Energy.

The minister also asks the regulator to assess whether the algorithm itself, on the basis of which the price of electricity is calculated on the exchange, is not another reason for high energy prices.

On Wednesday, the Lithuanian state energy company “Ignitis Gamyba” announced that the Combined Cycle Block (KCB) it manages had submitted as many as 24 different offers for Wednesday, the prices of which were significantly lower than the electricity prices of the Nord Pool exchange, but the cheaper offers were rejected after applying the so-called ” paradoxical rejection”.

According to the company, as a result, facilities offering significantly cheaper electricity production do not win auctions and do not have the opportunity to produce electricity, thus reducing the wholesale price of electricity.

Copying the text of this news is prohibited without the written consent of ELTA.

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