Electricity prices in the Finnish retail market

This study focuses, firstly, on the pricing of electricity in the Finnish retail market. In particular, the impact of the ownership structure on prices is tested empirically. Secondly, the influence of low-cost electricity sources on retail prices is considered. The question about whether the average fuel costs rather than the wholesale price determine the retail prices is thus addressed. The supply side behaviour characterised may explain the passivity of client activity in the seemingly competitive Finnish market.

Research highlights► Ownership has a strong impact on retail prices in the Finnish electricity market. ► Locally owned companies' rates are 5–15 per cent lower than investor owned companies' rates. ► Own low cost acquisition of electricity helps local firms to keep prices at low levels.