Finnish and Baltic gas consumption plummets in May

Combined Finnish and Baltic gas consumption slumped in May to its lowest since October 2022, as gas-fired power generation dropped.

Combined demand across Finland, Estonia, Latvia and Lithuania was 2.04TWh last month, below an already low baseline of 2.21TWh in May 2023 and just half the 2018-21 May average of 4.07TWh (see graph, data and download). This was the lowest for any month since October 2022 and the third lowest for any month since at least the start of 2018.

Warmer weather is one reason for lower consumption, with minimum temperatures across all four capitals roughly 3°C higher on the year and nearly 6°C higher than in the previous month (see temperature table). Warmer weather is likely to have eliminated most heating demand, although some may have lingered in Helsinki and Tallinn.

Alongside warmer weather cutting into residential gas demand, gas-fired power generation declined across the region. Many combined heat and power plants (CHPs) providing district heating will have switched off following the official end of the heating season, while renewable generation surged, leaving little room for gas in the generation mix. Average gas-fired output across the four countries was just 100MW, down from 211MW in May 2023 and 315MW in April (see gas-fired power generation table).

Finland accounted for the entire region's year-on-year decline in gas-fired generation, as Finnish output dropped to 66MW from 177MW in May 2023 while remaining stable in the Baltic countries.

Finland's gas-fired output fell despite nuclear generation falling to 2.58GW from 3.57GW because of overlapping maintenance at the 890MW Olkiluoto 1 and 1.6GW 3 reactors. Wind generation also slipped by around a fifth to 1.32GW, partly offset by stronger hydro and solar. In total, renewable output accounted for 58pc of the generation mix, up from 52pc in May last year.

Rather than increasing gas-fired generation at home, firms turned to power imports from neighbouring Sweden, where nuclear and hydro generation held strong. Finland imported a net 914MW last month, against net exports of 563MW in May 2023.

In the industrial sector, Lithuania's largest consumer, Achema, is still running its ammonia production facility at Jonava at around 50pc of capacity, or 21 GWh/d, dragging down industrial demand. Curtailments are likely to continue even if gas prices drop because Russian fertilisers are flooding the European market and undercutting domestic production, Achema Gas Trade chief executive Gediminas Vasauskas said at the Baltic LNG and New Energies forum last week.

Prices on the GET Baltic exchange averaged €36.56/MWh in May, up by 10pc on the month, but 2pc lower than a year earlier. Lithuanian prices increased most sharply on the month, by 17pc, while prices were up by 9pc in the Latvia-Estonian common market and by 5pc in Finland.

There were more than 2,000 transactions last month for a combined 451GWh, down from 642GWh in April. Lithuania accounted for 51pc of traded volumes, the joint Latvian-Estonian market 23pc, and Finland 26pc.

By Brendan A'Hearn

Finnish and Baltic May consumption by country GWh