The decreasing biomass prices can influence the heating prices

2017 04 19

A new record for the lowest price was achieved in March at BALTPOOL biomass exchange – the heat producer in Vilnius County purchased biofuel for 105 EUR/TOE for this summer. This is the cheapest half-year contract not only in Vilnius County, but also in the history of the biomass exchange.

Trading on the exchange enabled the company to buy biomass at very favourable prices. This example of successful cooperation is extremely encouraging and can contribute to lower heating prices for consumers in the future,’ says Artūras Kliukevičius, the General Manager of UAB Danpower Baltic, the heat producer that concluded the lowest price contract.

Danpower Baltic purchased 7800 TOE (tonnes of oil equivalent) of biomass at a record low price under a half-year contract. For comparison, the weighted average price under long-term contracts amounted to 128.34 EUR/TOE in Vilnius region in the summer of 2016.

In Lithuania, the weighted average supply price of woodchips under long-term contracts was 121.16 EUR/TOE (129.91 EUR/TOE in Vilnius) in the summer of 2016, and in the summer of 2015 it amounted to 119.35 EUR/TOE (108.89 EUR/TOE in Vilnius). The weighted average supply price under traditionally cheaper short-term contracts was 114.10 EUR/TOE (108.37 EUR/TOE in Vilnius) in Lithuania in the summer of 2016, and in the summer of 2015 it amounted to 112.82 EUR/TOE (109.43 EUR/TOE in Vilnius).

At present, the average price of long-term contracts concluded for the summer season in Lithuania amounts to 116.34 EUR/TOE, but one-quarter and one-month contracts can still be concluded. The average price of short-term contracts for the beginning of the summer season 2017 in Lithuania amounts to 112.52 EUR/TOE, but trading in short-term contracts is just starting, and the price level traditionally decreases in summer.

BALTPOOL is the operator of the Lithuanian Energy Exchange entitled to organise trade in biomass and other products. The company also acts as the administrator of public service obligations (PSO) funds and is engaged in the collection, payment and administration of PSO funds.

BALTPOOL belongs to UAB EPSO-G group of companies, which also owns the controlling stake in LITGRID AB, the operator of the power transmission system, and AB Amber Grid, the operator of natural gas transmission system. 100 percent of EPSO-G shares is held by the Lithuanian Ministry of Energy.

The auctions at the biomass exchange take place on the second working day of each calendar week. At present, BALTPOOL biomass exchange has 210 registered sellers and 75 registered buyers.

BALTPOOL biomass exchange commenced its activities under the current model in July 2013.

UAB Danpower Baltic is the largest producer of green heat in Lithuania – 7 power plants of the company with the total capacity of 190 megawatts operate in Vilnius, Kaunas and Joniškis. The company Danpower Baltic is controlled by Danpower GmbH, the leading heat supplier in Germany. The municipal services company of Hannover municipality Stadtwerke Hannover AG, which works under the trademark Enercity, holds 84.9 percent of Danpower GmbH shares. Stadtwerke Hannover AG is one of Germany’s largest municipal services companies operating in Hannover, it has 2,500 employees, and has sales amounting to EUR 2.3 billion.