Baltic states' electricity prices surge 60-fold after withdrawal from Russian power grid

The Baltic States have seen a dramatic surge in electricity prices following the decision by Lithuania, Latvia, and Estonia to withdraw from the unified energy system with Russia and Belarus (BRELL).

According to the Estonian public broadcaster, electricity prices in the region are now 60 times higher than in neighbouring Finland, Caliber.Az reports.

Operators have pointed to a combination of weather conditions and market factors contributing to the steep rise in energy prices.

"This week, there has been less wind and higher electricity consumption due to the cold weather," said a representative of Elering, the Estonian electricity and gas transmission system operator.

Another contributing factor to the price hike has been an incident involving the Estlink 2 energy cable connecting Finland and Estonia.

The average daily price for electricity in Latvia, Lithuania, and Estonia has remained above 10 cents per kWh (or €100 per MWh) since the countries' exit from the BRELL system. According to data from the Nord Pool exchange, while the price in the Baltic States stands at €61.05 per MWh, Finland's price is just €1.12 per MWh.

Notably, as of February 8, the Baltic states of Lithuania, Latvia, and Estonia have successfully disconnected from the shared energy grid with Russia and Belarus. The BRELL system, which was established after the Soviet Union’s dissolution to ensure stable energy supply, has now been abandoned as the three countries shift towards greater integration with the European Union.

This decision is part of a broader strategy by the Baltic nations to distance themselves from Russia and Belarus, particularly in light of worsening relations between Russia and the West.

In 2018, Lithuania, Latvia, and Estonia signed an agreement with the European Commission to synchronise their power grids with the European Network of Transmission System Operators for Electricity (ENTSO-E). 

By Aghakazim Guliyev