Stock Exchange Release 25 May 2023 at 14:15 EET
Fingrid is confirming its earlier plans to use the record-high congestion income from 2022 to benefit its customers and waive grid service fees for six months in 2023. In 2022, grid service fees were waived for four months. For 2023, Fingrid has announced that it will waive grid service fees for January, February and June and now confirms that it will waive grid service fees for July, November and December. This will reduce grid customers’ fees by altogether some EUR 300 million.
The high price of electricity and major area price differences increased TSOs’ congestion income, especially in the second half of 2022. Congestion income for 2023 has been significantly lower, with Fingrid reporting EUR 71.1 (166.6) million in congestion income for the first quarter. Congestion income arises for Fingrid from the area price differences at the borders of Finland and Sweden and Finland and Estonia. No congestion income arises from transmission links within Finland, unlike in the other Nordics countries.
The accumulation and use of congestion income are prescribed by EU legislation and use of the income is decided by the local supervisory authority, the Finnish Energy Authority. In Finland, congestion income is used for cross-border investment projects, they cover the costs resulting from cross-border transmission of electricity and development of cross-border transmission, and they can be allocated to the company’s turnover to reduce grid service fees. Going forward, Fingrid will also use congestion income to benefit its customers.
The current structure of TSO pricing or unit prices will not change as a result of the waiving of the grid service fees. Also, the waiving of the grid service fees decided on now will not affect the pricing of the company’s other services. Due to the increase in weather-dependent production and electricity consumption, fluctuations in the company’s market-based costs will increase, which means that the size of the grid service fees may have to be adjusted several times a year. On the other hand, growing electricity consumption creates an opportunity to achieve cheap grid service fee unit prices.
“The strong growth in the production of renewable electricity in Finland increases energy self-sufficiency and reduces the price of electricity, which serves to create a competitive advantage for Finland, attracting new industry to the country. Sustainability is highlighted and the greatest climate impact is achieved when fossil fuels are replaced with the cleanest electricity possible. The amount of fluctuation also grows in a weather-dependent power system, increasing the need for changes in customer pricing. Fingrid’s objective is to ensure a continued customer experience of high quality and efficient operations, and the competitive pricing of services,” says Fingrid’s CFO Jukka Metsälä.
Jukka Metsälä, Chief Financial Officer, Fingrid Oyj, tel. +358 30 395 5213
Jussi Jyrinsalo, Senior Vice President, Fingrid Oyj, tel. +358 30 395 5118
GlobeNewswire is one of the world’s largest newswire distribution networks, specializing in the delivery of corporate press releases, financial disclosures and multimedia content to media, investors, and consumers worldwide.