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Svenska kraftnät to start trading on the Intraday market for electricity

As a result of the introduction of flowbased capacity allocation (on 29 October 2024) and the transition to a 15 minute market time unit (MTU) in the electricity market (preliminarily in Q1 2025), the number of occasions when the flow on the HVDC interconnectors reverses direction is expected to increase.

Too many reversals of the flow of electricity cause wear and tear and shortens the life of the interconnectors. This risk is particularly high for the older interconnectors Fenno-Skan and Konti-Skan, connecting Sweden with Finland and Denmark respectively.

An external portfolio manager handles the trading

In order to limit wear and tear, Svenska kraftnät will countertrade on the Intraday market to reduce the number of reversals on Fenno-Skan and Konti-Skan. The process for handling the reversals with countertrade is developed together with Fingrid and Energinet, the Finnish and Danish transmission system operators, who will also trade on the Intraday market in their bidding areas. The transmission system operators lock the intraday capacity after the countertrade, to avoid trade flows in the opposite direction.

Svenska kraftnät has procured an external portfolio manager, Volue Energy Markets Services AS, who will carry out the trade on the Intraday market on behalf of Svenska kraftnät. Volue will have a so-called Chinese wall in the organization, in order to prevent the risk of insider trading.

The overall process:

  • At the end of the day, before trading, Svenska kraftnät determines whether any reversal needs to be handled with countertrade. Then it is determined which hours and which volumes need to be traded.
  • A market message is issued before a trade order is sent to the portfolio manager.
  • The portfolio manager trades as large a share as possible of the desired volume in the Intraday auctions (IDA) and if necessary, the remaining volume is traded on the continuous Intraday market (IDC).

Intraday auctions and the continuous Intraday market

Svenska kraftnät wants to primarily trade on the Intraday auctions (IDA) and only trade supplementary volumes on the continuous Intraday market (IDC). IDA, which was launched in the summer of 2024, has so far had low liquidity, but the volumes will probably increase over time. By trading on IDA instead of IDC, the risk of market influence is reduced.

IDC: Intraday continuous IDA: Intraday auctions.

Svenska kraftnät intends to start trading on the Intraday market to reduce the number of reversals during March 2025.

One of several measures to reduce the load on the HVDC interconnectors

Countertrading on the Intraday market is one of several measures that the transmission network operators have agreed on, to reduce the load on the HVDC interconnectors. Other measures are, for example, changed ramping, implicit losses, extended monitoring, dynamic profile selection and elimination of quarterly reversals.

Contact

For more information, please contact press@svk.se