Finland Times

The taxation of fuels used in energy production became tighter at the beginning of the year 2012  further increased in the year 2913 resulting increase of the prices of heat and transport fuels, according to the Statistics Finland.

The report released on Wednesday said that the price difference between diesel and petrol has narrowed down while the prices of hard coal and natural gas have fallen in the latter part of 2012.

 Although the consumption of electricity grew in 2012, consumer prices of electricity still continued to fall in the fourth quarter of the year compared to the previous year.

However, total prices of electricity for enterprise and corporate customers started to rise in September last year. The cheaper Nordic electricity produced with hydro power has been well available and it has replaced imports of electricity from Russia.

The consumer price of electricity  started to fall down since last year's April and the total price of electricity for small and medium-sized enterprise and corporate customers has been going down even longer.

 Prices for major consumers have fallen further in the last quarter of 2012, but in some tariff categories prices have started to grow. The system price of the Nordic electricity exchange fell last year by 34 per cent, on average. In last year's October, the monthly average system price started to rise for the first time in over one year. The area price for Finland in the Nordic electricity exchange fell last year by an average of 36 per cent. During 2012, electricity consumption increased by 1.1 per cent in Finland.

The consumer price of district heat was in January around eight per cent higher, on average, than one year before. The price of milled peat used in heat production was nearly 20 per cent higher in the fourth quarter of the year than one year earlier. At the beginning of the year, the taxation of peat in heat production tightened by EUR 3 per MWh and at the same time, the price of peat came closer to the price level of forest chips. 

The prices of peat products rose due to the weak peat production period. Peat has been replaced in energy production with more expensive fuels, such as forest chips and hard coal, which is already visible in the consumer prices of district heat for January, for instance. The price of forest chips went up by over five per cent from one year earlier and their consumption was also growing. 

The price of consumer wood pellets was almost at the same level although the value added tax rose by one per cent at the beginning of the year. In the last quarter of 2012, the price of hard coal used in heat production went down by nearly ten per cent, while that of natural gas went up by over two per cent from one year before.

The consumer prices of liquid fuels continued to grow. Among transport fuels, the price of diesel went up most, by nearly 13 per cent and petrol by an average of almost seven per cent last year compared to the previous year earlier. 

The price of light fuel oil increased by over six per cent last year. The higher excise duties and value added taxation that took effect at the beginning of 2013 further raised the price of energy.