One of Europe's largest generators of renewable energy, Statkraft, said Friday that Nordic power prices had been "pushed down" in the second quarter due to high levels of snow melt.
Announcing its results for the period, the company cited "significant hydrological surplus due to high snow reservoirs" as putting pressure on prices.
In addition, issues with reduced capacity in parts of the transmission grid have hampered efforts to export surplus hydropower. This in turn has generated bottlenecks and put pressure on prices, the company said.
Statkraft, which is owned by the Norwegian state, said the average Nordic system – or benchmark – price was 5.6 euros per megawatt-hour in the second quarter, a drop of 84% compared to the same period in 2019.
Generation, by contrast, grew by 3.6 terawatt-hours (TWh) to 15.9 TWh, pushed up by Nordic hydropower.
"High snow melting has given exceptionally low Nordic power prices during the spring and summer, leading to a weak second quarter result," Christian Rynning-Tønnesen, Statkraft's CEO, said in a statement. "Statkraft maintains a robust financial position and continues to develop new renewable energy projects across our markets."
The company reported net profit of 491 million Norwegian kroner in the second three months of the year, down from 2.1 billion kroner over the same period last year.
Like many companies around the world, Statkraft has been impacted by the coronavirus pandemic. Construction projects in Chile, India and the U.K. have been "temporarily halted" but are set to recommence "in accordance with the respective national guidelines on Covid-19."
In May, the International Energy Agency said renewable installations were set to fall this year due to the impact of the pandemic.
The IEA's Renewable Market Update report projected that 167 gigawatts of renewable capacity would be added in 2020, a 13% drop compared to 2019. It will mark the first decline in growth rate in 20 years.
In its report, the IEA said that the drop reflected "delays in construction activity due to supply chain disruption, lockdown measures and social-distancing guidelines" as well as what it described as "emerging financial challenges."
While new additions are set to drop this year, overall worldwide renewable capacity is still set to increase by 6%, according to the agency.