Finns Forked Out €5Bln Extra in Power Costs Last Year, Report Says
Power lineInternationalIndiaAfricaLocal experts placed Finland among the EU-wide energy market’s “losers” as far as pricing practices go, calling the ongoing energy crisis, in which costs for some consumers skyrocketed, a “producer’s paradise.”The ongoing energy crunch cost Finnish households an additional 5 billion euros last year alone, according to a survey by the Nordic country’s national broadcaster Yle.Between July and December 2022 alone, electricity providers charged consumers some 25 cents per KwH on average. For the sake of comparison, the average price in 2020 was 3.5 cents per KwH, far lower than today.The drastic spike in electricity prices has generally been attributed to the conflict in Ukraine and the subsequent disruption of supplies of Russian oil and gas due to the EU’s ill-advised sanctions.However, given that Finland’s electricity production costs have remained more or less the same, pundits, including Aalto University engineering physics professor Peter Lund, called the consumers’ energy bills “unjustifiably large.”“The energy crisis is actually an energy producer’s paradise,” Lund told Finnish media.According to Lund, Finnish energy companies, such as Fortum and UPM, have largely benefited from the electricity market system and its pricing practices, where the price for electric power actually gets determined by the most expensive energy source. The price hike thus allowed Fortum and UPM to double their profits during the energy crisis, while their production costs have stayed low.Professor Lund maintained that Finland ended up among the “losers” in the EU-wide energy market deal, as Central Europe’s energy prices also pushed Finnish electricity bills up.Finland’s Energy Authority revealed that the total cost for electricity more than doubled in 2022, with the average increase reaching 142%. However, the effect has been mitigated somewhat by a coordinated publicity campaign yielding as much as 10% in reduced consumption, compared to the previous year.EconomyFinnish Economy Enters Technical Recession Amid Inflation Spike7 March, 06:32 GMTFinland’s energy crisis, which largely mimics that of the eurozone, has been fueled by Helsinki’s backfiring “reprisals” against Russia and its energy over the special operation in Ukraine. From the very outset, Helsinki made a point of refusing to comply with Moscow’s demands to pay for gas in rubles, claiming that the hostilities in Ukraine, in which Finland resolutely supports the Kiev regime militarily and financially, rendered further cooperation with Russia impossible. As a result, numerous Finnish companies have left the country, accumulating losses.Meanwhile, as the Nordic nation tries to wean itself off Russian energy and sever the remaining economic and public ties, Finns are being burdened with soaring energy bills and are up against galloping inflation. Dark economic clouds hover over the country, as the Finnish economy recently entered technical recession, a development attributed to dwindling expectations among both consumers and businesses. In the meantime, the government accrued extra losses while offering its citizens various forms of energy relief, ranging from one-off payments to long-term subsidies. Prime Minister Sanna Marin admitted that the overall price tag may potentially exceed a billion euros.