In its November recap, Mind Energy said the Nordics were heading into the heating season with noticeably less water in reservoirs than usual. In Norway’s southernmost price area, NO2, reservoir levels had not been this low in 30 years, the company said. Reduced hydropower generation could add to pressure on already vulnerable southern Nordic markets.

Mind Energy linked the outlook to October’s surge in European gas prices and what it described as severe hydrological pressure across the region. “The Nordic countries are of course greatly affected by the extremely strained situation on the gas market, and the impact this has on Europe as a whole, but the other important element that has contributed to the large price increases in October is the strained hydrological situation,” said Karsten Sander Nielsen, the company’s senior market analyst.

Peter Nikolaj Krebs, Mind Energy’s vice president of customer trading, told Reuters that when wind output falls, German gas plants set prices in Denmark and southern Sweden and Norway. With gas prices at their highest since the end of 2022 and less hydropower available, the company expects volatility and potential price spikes through winter.