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The market is at a crossroads, let’s find the direction together

Early this year, Finland initiated discussion about the need to fix the electricity market, subsequently bringing about a broad-ranging exchange of ideas. The first concrete pilot project in the Nordic electricity exchange has also been launched.

Last spring, Fingrid’s energy policy discussion paper challenged decision-makers and industry operators to consider how we should move towards the electricity system of the future. Achieving climate targets is the starting point, but Fingrid believes that this can be accomplished in either a cost-effective and market-based manner or an inefficient and centrally controlled way. Fingrid also presented concrete methods that could improve market activity during the transition period and asked for views of them.

Discussion has been lively
 Hiekkala Juha

According to Fingrid’s Marketing Development Manager Juha Hiekkala, the paper surpassed expectations in terms of its success.

“We expected 10–15 comments, but we received a total of 36 feedback papers from different parties. Furthermore, the feedback and comments were very well prepared and thorough.”

The comments showed that discussion of this issue was considered very necessary.

“With regard to the key points, we found that many people have very similar opinions with us. On a more detailed level, there were a wider range of views focusing on issues that the different groups consider most important.”

The positive feedback was balanced by some well-argued, critical comments.

Some respondents believe that Fingrid is giving an overly optimistic picture about the situation. The challenging situation in the electricity market will not necessarily be resolved only by the methods presented by the company as possible solutions during the transition period.

According to Hiekkala, criticism is welcome and brings new opportunities to the energy discussion, where the common goal is to take the environment and use of low-carbon energy more into consideration.

Industry operators can influence future solutions right now and be a part of building a model that will make Finland a frontrunner, even on the European level.

“At Fingrid, we believe that we’re at a watershed right now. We can see the challenges of the new situation in our operative activities on a daily basis – now we have to choose which direction to take. We’re responsible for the functioning of the electricity system,” emphasises Hiekkala.

Pilot projects begin

With regard to the discussion paper, the Nord Pool electricity exchange has launched a pilot project in which intraday market trade continues until half an hour before the delivery hour. Fingrid is also starting a project that will increase transparency in the balancing power market.

A report has been compiled on the basis of the feedback received for the discussion paper and Fingrid’s conclusions, and work will begin together with various parties. Conclusions and measures will be presented at Fingrid’s Grid Day on 23 November.

“We’ll be presenting our views about the kind of actions needed to ensure that the electricity market functions well in changing conditions. It’s impossible for us to try and resolve all the issues in this broad field on our own. We have to work together,” confirms Hiekkala.