Press release

Financial crises effects the Nordic electricity market prices

18 November 2008, 11:00 EET

Fortum Oyj Press release 18.11.2008

Financial crises effects the Nordic electricity market prices                   

During late summer global market prices for oil and coal turned down after a    
lengthy increase. Also the prices for emission allowances have decreased during 
the autumn. This decrease has reflected to the Nordic electricity wholesale     
market prices. On the other hand, higher price level in the Continental Europe  
and weakened hydro reservoir situation, have eased off this effect.             

- Recent development has shown how the Nordic market is dependent on the global 
financial development. The situation on the market is showing some nervousness. 
There are many factors influencing the future development, anything from global 
financial situation to the coldness of winter days. Even in this situation we   
can experience very high prices on cold winter days, comments Lotta Forssell,   
Vice President Communication from Fortum's Power Generation.                    

- In Finland consumer prices are increasing after the wholesale price increase  
last summer. High fluctuations in wholesale prices put pressure on electricity  
sales companies to react faster in consumer pricing. Fortum is examining new    
pricing models for its consumer contracts, aiming at increasing the             
predictability and clarify, explains customer manager Timo Liiri from Fortum    

Fortum publishes a topical energy market review two to four times a year. Topics
covered in the review include for example fuel price development, electricity   
price development on the Nordic power market and factors influencing the        

Summary of the energy market review 18 November 2008:  
- The global economic slow-down has had an impact on the fuel and electricity 
prices and Fortum's way of analysing the energy situation. The economic         
slow-down will also have an impact on the global energy demand - at least on a  
short term.                                                                     
- Fuel prices increased during 2007 and the increase continued even more 
dramatically the first half of 2008. Since mid July the fuel prices have        
decreased dramatically but are still above the price level of early 2007.       
- After a steep increase Nordic wholesale electricity prices have decreased
during the past two months. The future price quotations are now on the same
level as before summer being around 50 €/MWh for the next year. 
- The Nordic water reservoirs are slightly below the long term average, and
there is less snow compared to historical levels. 
- Higher continental prices and increased transmission connections have
resulted in increased exports from Nordic to Continental Europe where the
prices are 15-25 €/MWh higher compared to Nordic. 
- Consumer prices in Finland have not fully reflected to wholesale price
increase and therefore the consumer price levels are in general below the
wholesale prices. 

Fortum Oyj
Corporate Communications                   

Further information:                                                            
Lotta Forssell, +358 50 45 36128, lotta [dot] forssell [at] fortum [dot] com                     
Timo Liiri, p. 050 45 36461, timo [dot] liiri [at] fortum [dot] com