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What is Nord Pool and how the electricity exchange price is set
Every day around noon, Europe auctions off the next day’s electricity. The result is a price for every 15-minute period in every bidding zone – exactly the prices our price map shows. Here is what sits behind them.
What Nord Pool is
Nord Pool is a power exchange. It started in 1996 as a joint Norwegian–Swedish market and grew step by step to Finland, Denmark, the Baltics and beyond. Today it is one of several European nominated electricity market operators (NEMOs) – alongside EPEX Spot, for instance – and runs trading in the Nordics, the Baltics, Germany, Poland, the Benelux, France, Austria and Great Britain.
The exchange neither generates electricity nor sells it to households. It is the place where producers, large consumers and retailers agree every day on how much energy will go into the grid tomorrow and at what price. The retailer you buy from usually buys here.
The day-ahead auction
The main market is the day-ahead auction. It runs once a day, simultaneously for the whole of Europe:
- Until 12:00 Central European Time, participants submit buy and sell bids for every period of the next day.
- One algorithm (known as EUPHEMIA) matches the bids of all countries together, taking into account how much electricity can physically be moved between them.
- Around 12:45–13:00 CET the prices are published. That is why tomorrow’s prices appear on the map in the early afternoon, not earlier.
Since 1 October 2025 the auction runs in 15-minute steps – 96 prices a day instead of 24. That is why the table has four columns per hour.
How the price is formed
In the auction, offers are sorted from cheapest to most expensive – the merit order. Wind, solar and hydro produce at almost no marginal cost, so they come first; nuclear and biomass follow; gas and coal plants, which have to buy fuel and emission allowances, stand at the end of the queue.
The price is set by the last plant still needed to cover demand. Everyone ahead of it in the queue receives the same price. Hence:
- on a windy night, when wind and hydro are enough, the price can be a few cents or even negative;
- on a cold, calm evening, when gas plants have to be started, the same zone costs ten times more;
- a small change in demand or supply can move the price sharply – the queue is steep precisely at the expensive end.
Bidding zones
There is no single European price. Each country – or, in large countries, each zone (SE1–SE4 in Sweden, NO1–NO5 in Norway, DK1 and DK2 in Denmark) – gets its own price. If there is spare capacity on the lines between two zones, their prices converge; if the line is full, they differ. More in why prices differ between countries.
What the exchange price includes
Only the energy itself. Your bill adds grid charges, levies, the retailer’s margin and VAT – together often more than the electricity. On the map, prices are shown without VAT by default and VAT can be switched on with one click; for the other parts of the bill see VAT and grid fees by country.
Why the exchange price matters even on a fixed tariff
Retailers build fixed tariffs from forecasts of exchange prices, so over time they follow the exchange. But the gains from price swings – cheap night hours, midday solar – are available only to customers on an exchange-price contract. How to use them: how to use the cheapest hours.