REPUBLIC OF EsT0NIA
MINISTRY OF EcoNoMIc AFFAIRS
AND COMMUNICATIONS
Tom Dareil
Nord Pool Group
[email protected] 30 08 ‘02’ No 17-9/’O’’/5358-1
Dear Mr Dareli.
Due to the ongoing Russian aggression towards Ukraine, European energy markets are working
under severe distress. Understandably, such extraordinary conditions also reveal sorne
shortcomings in the functioning of the electricity markets and power exchanges. The public
interest about the functioning of the power exchanges is higher than ever before. Therefore, it is
particularly important that information about the price formations in exchange as well as thorough
explanations to society about reasons behind extreme market events are provided in timely and
easy to comprehend manner.
1 am writing to you in order to express Estonia’s concems regarding the functioning of the Nord
Pool power market, mainly regarding the Iack of transparency and access to data. It is our joint
responsibility to seek and find solutions to the shortcomings in the system to maintain the public
trust towards the electricity markets. In recent times electricity prices on the Nord Pool power
exchange in the Baltic and Finnish region have reached extremely high leveis. This has raised
valid questions and concerns across the whole region. The most notable and extreme price hike so
far took place recently on the 17 of August, where the price ofelectricity on the Nord Pool Baltic
power exchange peaked at 4000 € per megawatt-hour. Price fluctuations on this scale are highly
problematic for our economy and for the society as a whole. Therefore, to avoid the occurrence of
such events in the future, 1 would kindly ask you and your team to take into coiisideration the
following observations.
Firstly, the transparency in the market needs to he increased. This would be crucial in order to
restore public confidence in the market system. Even when considering the general underlying
causes of the increased energy prices, it is difficult to understand and justify the extraordinary
peaks and extreme fluctuations on the electricity market. Therefore, 1 kindly ask Nord Pool AS to
analyse and employ different possibilities to improve the transparency of the functioning of
the power exchange and electricity market. In our view, to ensure higher transparency, more
information should be made public on the bids placed on the power exchange, including but not
limited to their origin, source and volume. We agree that such publication should also be made in
such way that fair cornpetition and functioning of the market would not bejeopardized, but we are
certain a solution can he found here. In addition. we believe, the relevant data should be publicly
available and not be hidden behind a paywall.
Secondly, regarding market supervision we propose to analyse the possibilities to speed up your
market monitoring notification process to the National Regulatory Authority (NRA). The process
ofinvestigation should take Iess time than one month. We see that the correct way to handle similar
Suur-Ameerika 1 / 10122 Tallinn / ESTONIA
Phone: +372 625 6342 / Fax: +372 63 1 3660 / E-mail:
[email protected] / http://www.mkmee
future inciderits Nord Pool AS should cooperate more with NRA and ifchanges are needed in the
processes or rules, adjust them in a swift manner, including but not Iimited to addressing the
possible issues to the European Commission.
We are grateful for considering our questions and concerns and we are Iooking forward to your
feedback.
With best regards,
Riina Sikkut
Minister of Economic Affairs and Infrastructure
Katry Ahi
+372 625 6374
[email protected]
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