Finland: Smart-metering defies peak power

For most countries in Europe, peak power occurs around 5 o'clock in the evening, when people come home from work, and turn on the TV, start cooking or simply switch on the heating. However in Finland, most homes are equipped with eclectic heating systems and by turning them on early in the morning to heat their homes, the Finnish make peak power occur in the morning, making prices swing wildly.

For Fortum, one of the largest producer and electrical distributor in the Nordic region, it is a situation that is being addressed with an ambitious program to combine time of use pricing with a regional buying pool.

The program aims to have all homes in Finland equipped with smart meters by 2013, enabling consumers to buy power at time-of-use rates set by market on an hourly basis.

Since the 1950s, Finland has utilised a time-of-use pricing programs, but they have largely revolved around estimating power pricing. While consumers can sign up for weekend/weekday or night/day pricing programs, the programs aren't tied to real-time pricing.

Speaking to Green Tech Media, Vesa Koivisto, the business development manager at Fortum said, "We don't have the 5 o'clock tea-time peak," during a meeting in Helsinki. "If you don't have district heating, chances are you are heating with electric."

How electric heating systems work is that an electric element is immersed in the water heating it up, and generating energy. If consumers have an efficient heating system, they can schedule it to heat the water during lulls in the price.

It is hoped that the new system will also allow retailers and distributors get power from Nord Pool, the regional electrical exchange. Currently, Finnish consumers effectively get their power from the nuclear, gas, coal and biomass facilities within the country's borders, but under Nord Pool, electrical distributors and retailers will be able to tap power from Norway and Sweden, which have more hydroelectric power.

There is some concern that prices could fluctuate depending on water volume. Koivisto commented that "with such deregulation, you could see the cheapest price randomly."

Fortum will start rolling out its smart meter program in Finland next year.

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