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Baltic power market completed with successful opening of Latvian bidding area

Baltic power market completed with successful opening of Latvian bidding area

On 3 June 2013 a new Nord Pool Spot bidding area has been launched successfully in Latvia. With this Nord Pool Spot has realised its long term goal of creating a transparent and open Baltic power market, with public, reliable prices, connected to the Nordic region. 
Virgilijus Poderys, the CEO of the Lithuanian electricity transmission system operator Litgrid, welcomes the opening of the Latvian bidding area: This is a big step in creating a Baltic and Nordic integrated electricity market; it will eliminate the isolation of the Lithuanian bidding area and will end some illogical flows within the Baltic power markets, but most importantly, this will increase the liquidity of the electricity market.
Commenting on the launch, Mikael Lundin, CEO at Nord Pool Spot, said: “At Nord Pool Spot we have been working closely with key stakeholders in the Baltic countries since 2007 to help open up the local power markets and link them to the Nordic area. Significant progress has been made, and with the opening of Latvia all the three Baltic countries are on their way to achieving the transparent power markets fully integrated into the Nordics, which they desire.”
The opening of the new bidding area comes as a result of an agreement with the Latvian independent system operator (TSO) AS "Augstsprieguma tīkls" (AST), which made it possible for Nord Pool Spot to be the market operator for Latvia.
Varis Boks, CEO of AST, underlines that the first and most important goal of the Baltic power market - integration – has now been achieved: “Close cooperation and hard work between AST, Nord Pool Spot, the Latvian authorities, and our colleagues in the Estonian and Lithuanian TSOs, have played a crucial role during the integration process. We are already looking ahead to more effective Baltic power systems integration.”
“The Latvian integration with Nord Pool Spot ensures a level playing field for all market participants from the Nordic and Baltic countries, as well as increased transparency in the market,” says Taavi Veskimägi, Chairman of the Management Board at Elering.
From 3 June 2013 all the transmission capacity between Estonia and Latvia will be transferred for implicit auctioning in Elspot, the same procedure will be applied between Lithuania and Latvia. Five members have already signed up and are ready to trade in the new Latvian bidding area. The day-ahead power price calculated for the first delivery day Monday 3 June was 46.51 EUR/MWh. Traded volumes were around 5,5 GWh for the first day of operation.
The full integration of Lithuania, Latvia and Estonia with EU energy networks and markets has been an important long term target of the Baltic states as well as the European Union.
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