Stormy Weather for the Nordic Wind Power Industry

The wind power industry in the Nordic region is at a pivotal juncture, facing challenges that threaten its growth and sustainability. The Nordic countries, leading in the adoption of renewable energy, confront decreasing capture rates, regulatory uncertainties, and grid constraints —all affecting the financial viability of wind power production.

Published

Feb 28, 2024

Energy Market Services

Windmills near the ocean

Between 2010 and 2020, the cumulative installed capacity of wind power in the Nordics more than doubled. The growth rate of wind energy installations in the region has outpaced other forms of energy generation and is expected to reach in excess of 220 Twh/y by 2035, including both onshore and offshore.  

In recent years, the wind energy sector has attracted substantial investments, driving further expansion and innovation in the industry. These investments have led to the development of new wind farms and the deployment of advanced technologies to enhance the efficiency and reliability of wind power generation.  

Access to marketplaces is crucial 

This scenario underscores the critical need for strategic trading and asset optimisation to navigate market volatility and operational constraints effectively. This is where Volue Energy Market Services, spearheaded by seasoned industry expert and Senior Vice President Tomi Pesonen, offers support and innovation. Volue's services, leveraging advanced analytics, forecasting, market insights and technology, empower Nordic wind power operators to optimise their operations and unlock marketplaces for wind farm operators of all sizes.  

Tomi Pesonen

"We enable different market operators to participate in the transition to more use of green energy by helping them handle all market processes.”

Tomi Pesonen

SVP Volue Energy Market Services

From Volue’s Helsinki office, Pesonen leads a team of around 100 energy industry experts based in Finland, Sweden, Norway and Denmark. The job of his team is to address the pain-points experienced by many renewable energy producers. 

Integrating advanced systems like the company’s in-house developed energy management system (EMS) and the Volue Algo Trader software, Volue is redefining market participation. As Pesonen outlines: "We offer a full service to our clients, ranging from 24/7 monitoring and optimisation of their assets, to providing them with access to all relevant marketplaces. This means that also independent producers can gain access to markets that are normally reserved for larger companies."

Do you want to learn more about how to maximise the value of your wind park? Watch our on-demand webinar

In addition to using algorithmic trading software to provide their clients with access to the intraday markets, Volue can also secure participation in balancing markets, ancillary services markets and capacity markets. This way clients have more legs to stand on to make sure they are getting maximum revenue from the energy they are producing.  

Regulatory demands for monitoring 

Another challenge facing wind power producers is increasing demand on having the required monitoring setup. To comply with Finnish regulations, it is required of operators to have in place 24/7 on-site monitoring of their wind farms, and other Nordic countries are expected to have in place the same regulations soon. In Finland, Volue has set up just this for many of their clients.  This is managed from a 24/7 operations control room, where 15 multilingual experts work in shifts to make sure nothing goes amiss.  

"As a customer of Volue Energy Market Services, you don't need to invest in those very expensive systems or set up your own full-scale operations. Instead, we provide you with full access to our utility-scale systems and operations." 

This allows Volue´s clients to make the all-important adjustments to their power generation, that both producers and regulators and TSO’s want to see. 

Declining capture rates pose profitability challenges 

A significant challenge for wind farm operators is managing the intermittency and variability of wind power generation. Wind is an inherently variable energy source, and operators must implement strategies to balance supply and demand and ensure grid stability.  

"Capture rates decline as more wind power generation enters the system”, says Tomi Pesonen. This highlights a paradox where the proliferation of wind energy could lead to its own profitability challenges, particularly in regions with a high concentration of wind farms. Pesonen adds: "Typically if it's windy, it's windy in a large region, which oftentimes results in an oversupply where electricity prices tend to go low or even negative”. 

Consequently, managing and optimising production and finding additional revenue streams is becoming increasingly important for wind power producers. Effective trading strategies allow operators to maximise revenues by selling electricity at optimal prices, while optimisation of wind farm operations can enhance efficiency and increase electricity production. This is where Volue Energy Market Services steps in, offering tailored solutions to address these very challenges. 

Acting as a force multiplier 

Volue provides advanced analytics, forecasting tools, and market insights that enable wind power operators to navigate market volatility and optimise their operations. By leveraging real-time data and predictive analytics, Volue helps operators anticipate market changes, adjust their production strategies accordingly, and capitalise on the best trading opportunities. This not only mitigates the financial impact of decreasing capture rates but also enhances the overall efficiency and competitiveness of wind power projects. 

“Volue's comprehensive suite of services includes balance management, nominations, and balance settlement at both the BRP and MGA levels, along with SCADA and monitoring for real-time measurement and control”, says Tomi Pesonen. “Individually, each of these services positively impacts the operations of our customers, but by integrating them, we can truly act as a force multiplier, significantly increasing profits and bolstering efficiency in a challenging and volatile market environment.” 

Do you want to learn more about how to maximise the value of your wind park? Watch our on-demand webinar.

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