Nordic Power Market

Outlook 2024 - 2050

Spring 2024, 42nd edition

"The underlying drivers in renewable energy are as strong as before. Nevertheless, we see an evident decline in investments. Increased costs challenge profitability more than before, and local opposition stops or delays many wind and solar power projects. In the long term, investors in green projects must have relatively predictable prospects for profitability and an acceptable return on capital. Therefore, the long-term price forecasts have increased quite significantly in our latest analysis" – Sigbjørn Seland, Chief Analyst

Available from APRIL 11th, 2024

Glacier and river

Key discussions for the Spring 2024 edition

  • Offshore Wind Power Investments
    In Norway, the first tender round for Sørlige Nordsjø II was completed 20th March at a price of 99 €/MWh. The high price shows that offshore wind power is very far from profitability without subsidies. The biggest uncertainty going forward is the extent to which government subsidies for offshore wind will remain sufficiently large to make offshore wind profitable, with significant implications for long term power prices.

  • Onshore Wind Power Investments
    Onshore wind power investments in the Nordic region are declining. A high level of conflict in many areas, with numerous vetoes from local authorities, as well as failing profitability in several price areas, stops many projects.

  • Slow Development of Solar Power
    Solar power investments, particularly in Norway, are progressing slowly. While the potential profitability of these projects is promising, conflicts related to land use and other factors are impeding or delaying investments.

  • Long-Term Profitability of New Production
    It is imperative that investments in new production ensure satisfactory profitability for investors in the long term. Although offshore wind power is likely to see growth due to government subsidies, we assume that offshore win, as all other power generation will need to operate without subsidies in the long run. Consequently, rising costs for new production are contributing to higher long-term power price expectations.

  • Impact on Demand-Side Projects
    The increased costs for new production are negatively impacting the profitability of projects on the demand side. Long term consumption growth will be dampened by rising power prices, which must eventually be high enough for investments in new power generation to achieve satisfactory profitability.

  • Flexibility in Consumption Growth
    A large part of the growth in consumption will come as flexible consumption in the periods with low power prices. Technologies such as hydrogen and other Power-to-X will play an increasingly significant role in the power markets.

  • Achieving Carbon Neutrality
    To achieve carbon neutrality, higher EUA (Emission Unit Allowance) prices are necessary. We provide our perspective on the EUA market and propose an alternative CO2 price that is better aligned with Europe's goal of becoming climate-neutral by 2050.

  • Cost Elements for the Power System until 2050
    Our report offers a comprehensive analysis of the various cost elements within the power system, projecting developments until 2050. We focus on Long Run Marginal Costs associated with renewable power production, energy storage, hydrogen production, and hydrogen-fired power plants.

Available for pre-purchase today.

Key insights

What does the outlook offer?
The long-term report offers four scenarios with an updated base case scenario, using market prices for coal, natural gas, and EUAs, a high and low scenario, as well as our expectation scenario based on our view of long-term EUA prices. The analysis is available as pdf including a spreadsheet with all relevant calculations from the analysis.

What price forecasts are included?
We include price forecasts with an hourly resolution for the Nordic system and all Nordic area prices up to 2050, plus price projections for Germany, France, the UK, Netherlands, Poland, Estonia, Russia, Latvia, and Lithuania on an annual resolution.

Does the outlook include annual supply and demand balance?
The Nordic Power Outlook also includes a detailed annual supply and demand balance for all price areas and estimates for SRMC and LRMCs for a large number of production technologies until 2050.

Report content

Spring 2024, 42nd edition (2024 - 2050). Scenario-based analysis with updated price prognosis for all Nordic price areas and neighboring countries

The Nordic Power Market Outlook contains 90+ pages of:

  • Four scenarios with an updated base case scenario, using market prices for coal, natural gas, and EUAs

  • High and low scenarios

  • Expectation scenario based on our view of long-term EUA prices

  • And much more

    Release date: APRIL 11th, 2024

Chief analyst Sigbjørn Seland holds presentation

Nordic power workshop

StormGeo offers a workshop where pre-agreed topics related to the Nordic power market are presented and discussed. For best use of a workshop we recommend to add the most recent “Nordic Renewables Outlook 2024-2050”. Use this opportunity to enhance your understanding of the market and to challenge us.

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Why not add a long term analysis on Nordic Renewables

StormGeo launches updated long term report on Nordic Renewables until 2050 on APRIL 11th. We highly recommend to include this report as the elcert and power markets are strongly interlinked.