A lot of my friends took a gamble over the winter, choosing to take the spot price electricity, over a contracted price. On many days, that is a great call as the spot price can be half of what I am paying per kWh, but on some days, it isn't such a great call at all - like tomorrow.
Yes... that is €2.35 per kWh.
The average price for tomorrow is €1.10. What this means is that if we were on spot price, on average we would be paying almost 12x as much for electricity. And what we use at the peak times, would be 25x as much. Heating a large house takes a fair amount of kWh, especially when it is -29°C outside. So, as we are heating our house from scratch due to the system problems, we can expect that tomorrow we will use about 200 kWh, so in one day, the price, without transmission costs, would be €220, which is about the same in US dollars.
For reference, that is what I paid for a gas heater, a new 10kg composite bottle and the hose connector today.
For another reference, that will fill my 65L car tank up 1.8 times.
This is the highest electricity prices have ever been in Finland, but the average today was 28 cents, and since the middle of December, it has been about 16 cents. We are on a contract at 9 cents. And we took the contract knowing that it is a gamble, because we will be paying the same price for kWh even in the summer, when the prices will be much, much lower. Though we won't be heating our house at that point, so our consumption drops dramatically. For us, the decision was for peace of mind and to keep a relatively predictable bill.
Two similar days in a month like tomorrow, and that is the equivalent to a month worth of electricity costs for us, and that is significant. Five days, and it is half an average salary worth. But, people are now stuck between a rock and a hard place, essentially playing a game of electric chicken with the prices.
Because they have made the decision to stay on spot because the assumption was that the new nuclear plant would give adequate supply, they have a sunk cost. And, the longer they go, the more they sink in, with the hope that prices will come back down and level out. And they well might, over the space of the next year, but how different will the overall price be, and how much stress has it caused them when the prices are so incredibly high?
I suspect, the difference isn't going to be that great once averaged out.
However, the people on spot prices are going to have to find the money to pay their bills now, not as an average later. This means that in the coming month, there are going to be people who are going to need to pay up to 20-30% of their total income more, just on increased electricity prices. They aren't getting anything more for this price, and it is unlikely that they will increase their earnings to cover it in the next month so they don't have to sacrifice their savings or lifestyle, which means, their spending is going to go down dramatically.
While the electricity companies are making record profits on the back of this, the rest of the economy is going to suffer further, as people trim back on their lifestyles to cover the increased costs of living, or go further into debt. Either way, the distribution of wealth narrows at a faster pace, with less in the hands of the majority, and more in the pockets of the minority.
There is no reason for the prices to be this high, because Finland is producing more energy than it has earlier, and the demand isn't significantly higher than other times. And, it has been cold before. Yet, there are constant excuses as to why the prices are so high, even though none of them are valid. It is just another money grab, taking advantage of people who trusted them when they said "the supply is good".
Maybe they should have questioned if it is good for the consumer, or the corporations.
Fluctuations in prices are to be expected, but just imagine if you went to fill up your car one day, and instead of $100, it was $2500 - and you had to fill up. While they are talking about conserving electricity, there is very little people can actually do in these situations, because the majority of the consumption is on heating, which as I have learned intimately, is a necessity. You can drop the temperature in the house slightly for a day or two, but too much and it becomes unlivable at these temperatures. We conserve energy where we can already, because 9 cents a kWh is still expensive, but we can actually affect our bills that much through using less.
For some of my friends, this is more of a large annoyance, as they are in apartment buildings, so their consumption is relatively low and it is often district heating, which is far cheaper. But, for a few others with standalone houses, they are going to really feel these days in their paychecks and savings, especially as it is right after Christmas and they are likely a little depleted already.
Personally, rather than all the money spent on military, I think that it should be spent on developing clean, cheap energy. There shouldn't be a lot of profit in energy creation and distribution and rather, the money should be made on what that energy enables. But, that isn't going to happen, because there is so much money in keeping people scared enough, that they accept buying weapons instead of wellbeing.
Maybe that is for another article though.
Taraz
[ Gen1: Hive ]
I honestly do hate that things like power companies have been privatized. Obviously I understand all the arguments about how governments are traditionally bad at doing things, and I don't disagree, but when you add an ever increasing profit margin on the top of everything that (you very correctly stated) affects the price of literally everything else then it's just not sustainable.
The power incentives in many US states are super frustrating. The power companies get money from the government for building new infrastructure, but not for maintaining current infrastructure, which is bananas to me... so things don't get maintained and people die.
Australia has some of the cheapest rooftop solar power in the world, and lots of people are motivated by super cheap power... but in the US, people are motivated way more by creating predictable and consistent prices for themselves. They're not even aiming for cheap power, they just don't want to suffer the exact fluctuations (and also power outages) that you're describing.
My power goes out all the time... America is such a bad richest country in the world.
Business models really aren't, because they always assume an increasing profit. !0% a year or anything, just doesn't add up. The only reason they can survive is through innovation, but things like power companies and banks don't change, they are like a static suck, but still looking to make additional percentage every year for growth.
It is a scam, isn't it? Always having more money coming in, never having to build well and maintain.
Do you ever wonder how it is a superpower at all?
Hahaha, I CONSTANTLY wonder how the US is a superpower.
I truly think that the US created systems and processes purely to be different from established British/European systems and not because they found actual better ways to do things.
The privatization of so many of these institutions is such a scam, that ends up costing taxpayers so much more financially, and additionally causes more harm and death. So many of these situations are almost perfect examples of the worst way to do things.
-29 C? ... brrrrrrrr... 🥶
I didn't even know electricity had a spot price -- but it appears tomorrow is a bad day to go spot in Finland!
Yeah... greed turns growth from symbiotic to parasitic. Eventually, you'd think the host would die with the parasite -- but it seems govs and corps have done a pretty good job of keeping us (the host) barely surviving on life support, though. Eeking out painful breaths under the weight of their gargantuan machine.
Strange how they have so much data informing them that a society with limited spending leads to economic downturn -- yet they do this anyway.
Not sure what the point is.
Yes. There is a drive to "do with less" as some kind of personal growth mantra, but it has been hijacked and turned into "pay more for less"
It is all about profit for the few.
That's pretty horrible. Our bill is relatively the same no matter the time of year. Anywhere between $150 and $200 per month for gas and electric. We used to be on a budget plan where you always pay the same price every month. Then at the end of the year they either charge you more for the difference, or give you some money back. Our new house has been so consistent, we didn't really see the point of signing up again here.
Consistency would be great. Our place is from the 60s and isn't the most energy efficient, so when it drops so cold like this, it sucks electricity to keep it warm.
We need new insulation and windows in our house, so even though it was built in the 80's it is still pretty inefficient. Much better than our hold house however!
Wow! I know our electricity prices have gone up but we don't have that model here. I also got a 2kw solar system with a 10kw inverter and I make AUD 14c a kW in summer (now) I cover my electricity needs and make around $2 a day. I hope the surplus covers my winter expenses
That is decent. Breaking even on electricity would be awesome. The prices at the moment are insane.
Wow that is insanity.
I don't even know how my bill works lol.
But it never spikes like that.
Yeah - you'd think there would be some kind of low on energy, but apparently this is acceptable pricing. Guessing there aren't many miners running in Finland at the moment.
We like that kind of thing too, makes budgeting a hell of a lot easier. Spot pricing sounds like the potential to be able to save a lot of money but also like those savings would just get nommed when it goes up again.
Unless that's the idea.
Either way even if spot pricing was a thing that was available here I don't think it's something we'd ever pick.
I feel bad about not feeling bad at all about how snide I've been getting when I have lately been pointing out in meatspace how people who are scared literally stupid will always make monumentally stupid decisions x_x
Yep. It is a gamble that might pay off a little, but could lose a lot. With such much fluctuation at the moment, I wasn't willing to risk it.
It is the "average" person now. The right to be stupid. There will be marches soon against "smart privilege"
Not so much marching but isn't that already happening in schools where things have to be adjusted/changed/something (I'm not quite sure what, I don't use the school system, just hear other parents complaining about it) because it's totally unfair for the average/below students that they're not doing as well as the smart/dedicated ones and the "playing field should be level".
Speaking of levelling playing fields, sibling dearest was telling me about how there are AI directors that are banging on about how they're looking forward to "improving their talents" and how it's great that the technology exists to "take artists down a peg or two" and "level the playing field" (quoted stuff is stuff she was air quoting) and then they're outrage tantrumming about how it's completely unfair that artists are using services like Glaze to poison the datasets.
I don't know what is more shocking, the price fluctuation of the electricity or the temperature outside, I'll take our warm weather every time, stay warm buddy.
It is a "bit cooler" than when I lived in Cairns....
This is one of the reasons I left the cold nations and now on the tropical side. Though summers are worst in tropical places with humidity but winters kind of kill me badly lol. I find centralized heating and the finding building which are safe and warm during winter is a pain.
I don't mind the cold weather outside, and pretty cool inside, but this has been too much for me as it has been for so many days. It is like the cold has soaked into my bones!
with prices like that I would quickly go mad.
For sure. It is insanity.
3 years ago I went on a fixed contract, and as I asked my wife, she was like, pay the extra £20 and get one extra year. Since then the price increased 3 times more, and my contract will end in September 2024. I brace myself for the shock.
Ours ended at the start of 2023 and it sucked. We went on spot price for most of the year, but contract for November on. It is 12m, but will see if we extend it. The thing is, they are setting a "new normal" and it is much higher than the old
Today I just paid about $10 electric bill which is monthling.
I think today, people will pay that amount while I write this comment...
I think electricity bills are directly proportional to the weather. Higher the cold higher the bills. In my areas we are just suffering from that
Yes, but we have had cold weather before, it isn't rare in Finland. When the weather was similar a month ago, the prices were 10x cheaper. This is craziness.
It sounds like a pain. It's hard to tell if they are making up numbers or not. It does sound a bit weird since the new plant should decrease prices. Prices are also going up here in the US and I don't really think what they are doing is solving any of the issues either.
Just a massive money grab, since no one can do anything about it.
Wait…you mean €220 for heating your house in a day?
That’s so much!!!
Wow
It is crazy. Ours won't be that much, as we are capped on kWh at 9cents, but it will still be expensive on average. For us, electricity was 450 for December.
Woah, shouldn't there be a cap on those prices? That just feels very abusive and exploitative having to pay for that much. It is very dangerous if the supply is manipulated, or when it is very cold and the demand is high, like now.
You'd think - but apparently not. They had to make a new graph to visualize it...
I think I understand why your electricity consumption is high. You have concluded a very profitable contract. And the Universe has given you the opportunity to take advantage of it.
I wish that was the case. Our heating takes too much electricity. We conserve it where we can.
It's not just peace of mind. The predictability of the bill is also somewhat controlled by you then... you can switch off the lights and save energy on everything, thus also lessening the price at the end of the month.
We pay around 0.12 usd for a unit so I'd say that's fairly good
Yep. We can reduce the costs a little, but heating is by far the biggest percentage. Probably 90% of the bill or more.
You it doesn't get as cold here so no need for so much heat to be generated. Although Finland? You get snow and cold right?