Questions and answers about electricity shortages

Last update on 10th of October at 2 pm.

REGARDING ELECTRICITY SHORTAGES IN GENERAL

How do electricity shortages arise?

An electricity shortage occurs when electricity production and imports are not enough to cover electricity consumption. Electricity shortages can arise in several ways:

  • As a consequence of a long period of freezing temperatures. Finland’s electricity consumption is highly dependent on the temperature. When the temperature drops by one degree, it causes an estimated 150 megawatts of additional electricity consumption.
  • As a consequence of a sudden disturbance that causes an important power plant or electricity transmission link to be unavailable.
  • A combination of the above, when a power plant or transmission link suddenly develops a fault during a period of freezing temperatures.
Why is there a risk of electricity shortages?

The factors affecting the onset of an electricity shortage are as follows:

  • The discontinuation of electricity and gas imports from Russia to Finland.
  • The possibility of delays to the commercial commissioning of Olkiluoto 3 (1,600 MW).
  • The state of Nordic reservoirs. The Nordic power system is dominated by hydro power, and the reservoirs are lower than normal following a dry summer. The situation may improve or deteriorate, depending on precipitation in the autumn.
  • Faults in the transmission links with neighbouring countries.
  • Electricity shortages or a scarcity of electricity in neighbouring countries, meaning that electricity cannot be transmitted to Finland.
  • Unforeseen disturbances in power plants.

Fluctuations in renewable energy output. The proportion of electricity generated cleanly using wind or solar power is increasing. Variable energy production can lead to lower wind power output when there is no wind and reductions in solar power output.

How can electricity shortages be avoided?

The risk of an electricity shortage is lower if the winter is mild and windy and if less electricity is consumed by industrial plants and households. When industries and consumers reduce their electricity consumption (demand-side management), it can help keep the power system in balance. Even minor electricity reduction measures affecting a large number of consumers can have a positive effect on the overall state of the power system.

How would an electricity shortage affect Finland?

Disconnection plans have already been made for use in the event of an electricity shortage. These ensure that the most critical consumers – such as hospitals – are not disconnected. For households, an electricity shortage may result in occasional power cuts lasting an hour or two at a time. Power cuts may occur again later on.

Power cuts will rotate, so they will occur in different places around Finland. Fingrid will notify each distribution system operator of how much power must be disconnected. After this, the local network operators should implement electricity distribution outages in a rotating fashion.

Efforts will be made to avoid electricity distribution outages affecting consumers for as long as possible, and consumers will only have their power disconnected once every other remedy has been used.

Who is responsible for handling electricity shortages?
  • The Ministry of Economic Affairs and Employment is responsible for public communications.
  • Fingrid is responsible for operational implementation during electricity shortage events in Finland and for coordinating actions with the neighbouring countries.
  • The local distribution system operators are responsible for restricting electricity distribution in accordance with the instructions issued by Fingrid’s Main Grid Control Centre.
  • The National Emergency Supply Agency will begin to take action if the special emergency restrictions and electricity rationing measures specified in the Emergency Powers Act are introduced. Among other things, the Government may restrict or prohibit the consumption of electricity for all purposes except those that are essential for the security of supply or impose an electricity consumption quota.
What are the phases in an electricity shortage (tiers 1–3)?
  • Electricity shortage possible (1): The forecasts indicate that in the near future, Fingrid will be unable to maintain rapid disturbance reserves in an amount that would offset a dimensioning fault and domestic production and imports are not enough to cover electricity consumption. Fingrid will announce this on its website. The Ministry of Economic Affairs and Employment will inform citizens of the possibility of an electricity shortage.

 

  • High risk of electricity shortage (2): All the electricity production available in Finland is in use, and no more electricity can be obtained from Finland’s neighbouring countries. Fingrid will announce this on its website. The Ministry of Economic Affairs and Employment will inform citizens of the possibility of an electricity shortage.

 

  • Electricity shortage (3): Electricity production and imports are not enough to cover consumption, and Fingrid needs to exercise its right as the party responsible for the system to disconnect electricity consumers. Fingrid will announce this on its website. The Ministry of Economic Affairs and Employment will inform citizens of the possibility of an electricity shortage.
How can an electricity shortage end?

 An electricity shortage ends when the production and imports of electricity are sufficient to cover consumption. Fingrid, the transmission system operator, will announce the end of an electricity shortage. Electricity shortages may recur, and in such a situation, Fingrid will follow the same electricity shortage instructions again.

If you do not have a spot-price or fixed-term contract, does the time of day when you consume electricity make any difference to your electricity bill?

Everyone should save electricity, irrespective of the type of contract they have. Saving electricity could prevent us from having an electricity shortage.

What is the difference between an electricity shortage and electricity rationing?

An electricity shortage is a short, temporary situation in which there is less production than consumption. The power balance will be maintained by imposing rotating power cuts. Conversely, if the use of electricity is restricted in extraordinary circumstances in line with the Emergency Powers Act, the consumption of electricity for certain purposes is forbidden using quota rationing or distribution outages.

 

INFORMATION FOR CONSUMERS

Can consumers receive compensation for the power cuts caused by an electricity shortage?

No. According to the Electricity Market Act, consumers are entitled to a price reduction or damages on the basis of an error in electricity distribution. A power cut necessitated by an electricity shortage is not an example of an error in electricity distribution, so no compensation would be payable on the basis of the liability for errors described above. Similarly, since such an event is beyond the control of the distribution system operator, the standard compensation for electricity distribution outages provided under the Electricity Market Act would not apply.

How long could the power cuts last?

Fingrid will notify each distribution system operator of how much power must be disconnected. After this, the network operators should implement electricity distribution outages in a rotating fashion.

The restriction is requested to start immediately, and the restriction is announced to remain in force until further notice. The network operator will rotate the load shedding around its distribution network in two-hour outages.

What should I do during an electricity shortage? Can I make a difference?

Consumers are advised to prepare themselves for electricity shortages by purchasing household essentials in advance. Consumers should follow the information about saving electricity and the guidelines issued by the authorities. The Ministry of Economic Affairs and Employment is primarily responsible for informing citizens of the possibility of an electricity shortage, but Fingrid, local distribution system operators and the media may also publish information and guidelines about electricity shortages.

Keeping a stock of food and drink at home in case of emergencies is one aspect of contingency planning.  The recommendation is for people to have 72 hours of emergency supplies, so every household should be able to cope independently for at least three days in the event of a disturbance. For more information on emergency supplies in the home, see the Martha Organisation’s website.

What is done to ensure that critical societal functions like hospitals can continue to operate in the event of an electricity shortage?

Load shedding (disconnection) plans have already been made for use in the event of an electricity shortage. These ensure that the most critical electricity consumers – such as hospitals – would not lose power. Hospitals also have their own reserve power generators. Reserve power ensures that hospitals can continue to operate uninterrupted.

Who is liable for damages caused by an electricity shortage?

In principle, damage caused by a power cut would hardly be compensated by anyone. There is no specific legislation on compensation for damages in the event of a blackout, but the general rules and doctrines on compensation for damages should be considered. Since a blackout is an exceptional situation of general market activity, it may be impossible in practice to attribute responsibility to a single party.

Blackouts can also occur unexpectedly, for example due to storms or electrical work in a residential block, so it is worth preparing for unforeseen blackouts outside the blackout situation. Preparing for blackouts is based on the idea that electricity users also have a key responsibility for organising their own electricity supply. Electricity users must plan their own activities and make the necessary back-up power arrangements, for example, if uninterrupted electricity supply is important. Equipment failures caused by power cuts are rare, as the equipment is designed to withstand them. If equipment does break down, it is usually due to the age of the equipment or its technical characteristics.

How can I find out when I need to save more electricity?

You can use the free Tuntihinta app to monitor the current electricity price. If the electricity price is high, the availability and sufficiency of electricity are lower. When the price is high, it is a good idea to avoid using the sauna or washing machine, even if you have a fixed-price electricity contract or a contract that is otherwise affordable.

 

Will there be a public campaign to encourage people in Finland to save electricity?

The Down a Degree campaign will be launched on 10 October 2022 to encourage consumers to get involved in a nationwide energy-saving effort. The heart of the campaign is a set of tangible energy-saving guidelines for Finnish consumers, households and housing companies that will yield quick benefits. (The last sentence is a quote from the Motiva website.) https://www.astettaalemmas.fi/

How can you guarantee that home carers will be able to cope with power cuts if a patient is on life support and there are no batteries? Other treatment devices are also completely dependent on electricity.

In cases like these, it is a good idea to be prepared for disturbances in the electricity supply even under normal circumstances – a power cut could occur in a household or district even if there is not an electricity shortage. Any planned outages will last for 1–2 hours. However, unplanned disturbances may require corrective measures that could take much longer than this. It is a good idea to make a contingency plan if the supply of electricity is vital.

Outside the times of peak consumption, spot-priced electricity contracts usually offer cheaper hours. Is it likely that these will cease to exist in the winter?

The price is strongly dependent on the amount of wind power. When the weather is windy, electricity is likely to be cheap at certain times, even in the winter.

If an electricity shortage occurs, can the electricity supply be restricted in such a way that consumers’ homes are supplied with enough electricity to meet their minimum needs?

Consumers can limit their consumption themselves, but in the event of an actual electricity shortage, it is necessary to impose larger restrictions quickly, and consumers are within the scope of these restrictions.

Why are only households being asked to save electricity? Where are the energy-saving measures for the public sector, industry and other services?

Many industrial companies buy electricity directly from the electricity market, and their purchases are flexible depending on the price. Fingrid first uses market-based measures by electricity producers and major electricity consumers, such as industrial plants.  It will only be necessary to introduce measures to restrict electricity distribution after all the market-based measures have been implemented and the reserve power plants intended to offset disturbances are all in operation.

Why is there a large spike in the electricity price at 8 am almost every day?

Electricity consumption rises every morning when people start their day, and the price reflects the increase in consumption. On weekdays, consumption is especially high in the mornings from 8 am to 10 am, in the afternoon between 4 pm and 5 pm, and in the evening between 6:30 pm and 8 pm. It would be good if people could try to even out their electricity consumption on weekday evenings and use high-powered devices outside these hours.

How will power cuts be announced?

Power cuts will be announced for each distribution company. The communication channels may include text messages and emails. Media companies will also announce power cuts on their websites.

 

IN-DEPTH INFORMATION

What can Fingrid and other parties do before taking action against electricity shortages?

Planned power cuts are among the last measures taken to address an electricity shortage. Before resorting to this, a series of other measures will be taken, such as requesting additional balancing bids and starting up the reserve power plants intended for dealing with disturbances.

Primarily, Fingrid endeavours to use voluntary measures by electricity producers and consumers in the electricity market. It will only become necessary to begin restricting electricity distribution once all possible measures have been taken on market terms.

How will an electricity shortage affect the price of electricity?

In the event of an electricity shortage, the price of electricity is likely to be very high.

Why is electricity consumption not restricted at night when it would have less of an impact?

An electricity shortage occurs when electricity production and imports are not enough to cover electricity consumption. In such cases, it is necessary to restrict consumption to stop the power system from crashing altogether. Under normal conditions, electricity is needed the most in the morning hours on weekdays, when society is at work. If an electricity shortage occurs, the measures to restrict electricity consumption must target the times when electricity production and imports are not enough to cover electricity consumption.

Could the charging of electric vehicles be restricted now that electricity is in short supply?

Under normal conditions, when we look at the power system of Finland from the perspective of the main grid, the answer is simple: there is plenty of electricity – enough for electric vehicles as well. When electricity is cheap, it means there is no shortage of electricity, and electric vehicles are charged at times when electricity is cheap. Smart charging solutions are included in electric vehicle charging stations and in the vehicles themselves, enabling electric vehicles to be charged when electricity is more affordable.

 In the future, as technology develops, it may become possible to use electric vehicles to support the main grid. One way of doing this would be for electric vehicles to feed electricity back into the main grid from their batteries.

Is Finland self-sufficient in electricity production?

At the moment, Finland is reliant on imports at times of peak electricity consumption. In other words, the power plants in Finland are not currently able to produce enough electricity to cover the largest estimated consumption peaks.

Electrification is proceeding at pace in Finland. In the coming years, Finland will become mostly self-sufficient in electricity production as the Olkiluoto 3 nuclear power plant ramps up and major wind power investments come online.

In 2021, a total of 86.7 terawatt-hours of electricity was consumed in Finland. The electricity consumption peak of 14,267 MWh/h occurred between 9 am and 10 am on 18 February 2021. Domestic production was then 11,191 MWh/h and net imports were 3,076 MWh/h. 

In 2021, Finland’s electricity consumption was approximately seven per cent higher than in the preceding year. The reasons behind this rise were a colder winter and a return to normal volumes of industrial consumption following the uncertainty caused by the coronavirus pandemic in the previous year.

In addition to domestic production, electricity can be imported to Finland from Sweden, Estonia and, in small quantities, Norway. There has been no electricity transmission between Russia and Finland since May 2022.

In 2021, the vast majority of the electricity transmissions between Finland and Russia were imports from Sweden to Finland. In 2021, a total of 15.9 terawatt-hours of electricity was imported from Sweden to Finland, and 0.9 terawatt-hours was exported from Finland to Sweden. The predominant direction of electricity transmission between Finland and Estonia was from Finland to Estonia – a total of 6.7 terawatt-hours. A total of 0.3 terawatt-hours of electricity was imported from Norway to Finland in 2021. A total of 9.2 terawatt-hours of electricity was transmitted from Russia to Finland.

Will consumers and various critical functions experience power cuts?

Disconnection plans have already been made for use in the event of an electricity shortage. These ensure that the most critical consumers – such as hospitals – are not disconnected. Efforts will be made to avoid electricity distribution outages affecting consumers for as long as possible, and consumers will only have their power disconnected once every other remedy has been used. It is possible that some critical electricity consumers could be disconnected if the electricity shortage is prolonged or the restriction is large in scope.

Critical parties have their own reserve power generators, which start up if there is no electricity available on the distribution network. Critical parties should test their reserve power generators regularly.

Does the estimate of peak consumption in the winter (14,400 MW – this figure was estimated on 9 December) take into account the fact that many people in Finland will reduce their electricity consumption in the coming winter?

The estimated peak consumption includes electricity savings by consumers. In September, the savings averaged seven per cent. When consumers save electricity, it really makes a difference to the management of electricity shortages. If we all reduce our consumption, we can contribute to ensuring there is enough electricity for everyone.

Why is electricity in Finland twice as expensive as in Sweden?

In the Northern Sweden price areas in particular, there is currently more supply (electricity production) than demand (electricity consumption). In addition, the electricity production capacity is mostly inexpensive wind or hydro power. Not all of this low-cost production can be transmitted to Southern Sweden and Finland due to bottlenecks in the network, both within Sweden and at the border between Finland and Sweden. The need for additional capacity is recognised – this is why Fingrid and the Swedish transmission system operator, Svenska Kraftnät, have planned the Aurora Line, which will be the third interconnector between Finland and Northern Sweden. When it is completed in 2025, the Aurora Line will increase the electricity transmission capacity from Finland to Sweden by approximately 900 MW and from Sweden to Finland by approximately 800 MW.

Will the electricity price continue to rise in the future, or is it possible that it will go back down to its previous level?

The energy sector is in a state of transformation, and nobody knows for sure how the situation will look a few months from now, for example. At the moment, the prices of electricity futures seem to be going back down in spring 2023.

Why has the electricity price gone up by several multiples, although the price of production has remained about the same?

Some electricity production costs just as much as it did before. However, various production methods that can scale according to demand (natural gas, coal, oil) are more expensive than before, and, in simple terms, the price on the power exchange is determined according to the bid that ends up using the most expensive production.

Why has Finland not introduced a price cap like the ones in Germany or Spain, for example?

Introducing a price cap could lead to an electricity shortage, as the electricity traded on the power exchange, which Finland is still reliant upon for the time being, would then be sold to countries offering to buy at higher prices. However, the government’s Electricity Price working group is of the view that Finland should submit an initiative to the European Commission to moderately reduce the bids on the power exchange in the EU in a way that would not exclude significant amounts of production capacity or demand-side management from the market.

Has anything been done to determine which parts of Finland produce enough electricity and which have a deficit?

So far, there is no need for regional analyses in Finland because a strong main grid enables the situation to be managed nationally.

What is the distribution of electricity consumption in Finland between households, municipalities, the state and enterprises?

In Finland, industry consumes about half the electricity, services consume one quarter, and one quarter is consumed by households and agriculture combined.

Why does Finland not invest enough in electricity production? Why does it expect countries like Germany and Italy to cope with the energy crisis?

More production is currently under construction in Finland than ever before. However, there is a short delay before new production facilities come online, so next winter will still be challenging.

The news assures us that the situation will be eased when Olkiluoto 3 is up and running. However, even when we have summer weather, our net imports of electricity are greater than the capacity of OL3. What will happen when the freezing weather sets in?

Olkiluoto 3 will increase Finland’s electricity production capacity by 10–15 per cent in the winter. Electricity is imported into Finland all year round if foreign countries can supply it more cheaply.

Why is the start-up of Olkiluoto 3 expected to reduce prices in Finland if the electricity market is pan-European? Olkiluoto’s production is small compared with the European electricity market as a whole.

There are times when, for example, it is not possible to transmit all the cheap electricity from Northern Sweden to Finland because the transmission capacity is good but limited. Increasing the production volumes in Finland will also free up a transmission route for electricity imports.