While Norwegian hydropower producers have bypassed water resources due to lots of snowmelt this year, the neighbouring countries Sweden and Denmark, face high electricity prices caused by limited import and export capacities. In the future, new interconnectors and reserve markets will lead to more sustainability and open profitable opportunities for producers.
Linking together the Nordics and continental Europe
The near-future opening of new power cables from Norway to Germany and the UK will significantly change the situation. The Nord Link cable will transmit up to 1400 MW between Norway and Germany from March 2021 onwards. The North Sea Link will add a similar exchange capacity between Norway and the UK later in 2021.
Increased flexibility through reserve markets
In parallel, multiple changes lie ahead on the Nordic reserve markets, so the so-called ancillary services, by the Nordic TSOs. These changes aim at improving the stability in the electricity supply to mitigate disturbances from rapid variations in wind and solar power generation and unexpected loss of cross-border transmission capacity.
The tertiary reserve market has already changed from an hourly to a 15-minute market, and market closure is 45 minutes before delivery. The new system for automatic activation of bids is now fully operational in Norway. Numerous companies are currently using Volue's solutions Powel Ancitra for bidding in the tertiary reserve market, and Powel Activation Request to manage electronic activations from TSOs. We have received overwhelmingly positive feedback from our customers, both regarding high user-friendliness and proven time-saving functionality.
A profitable market for Nordic power producers
The latest news is that the European Agency for Cooperation of Energy Regulators (ACER) on 17 August 2020 made the final decision regarding specific rules for the common Nordic aFRR capacity market. The Press Release states that the Nordic TSOs aims at opening the new Nordic capacity market during the 2nd quarter of 2021. There are many indications that the aFRR capacity market will become an important and profitable market for Nordic power producers, particularly for the front-runners with lots of hydropower flexibility.
Technology for a sustainable tomorrow
The Nordic power market is changing and offering opportunities for producers and traders. Volue's mission is to provide software, services, and insight for a sustainable tomorrow. We offer a full range of solutions to use market opportunities - from the day new markets open, and whenever new market rules are imposed. Feel free to get in touch to learn more about how Volue can help you.
Article by Nils Olav Tangvik, Sales Manager Hydropower Solution at Volue