As winter approaches in Finland, many households face a familiar question: should they stay on a market-priced electricity contract or lock in a fixed rate before the coldest months arrive?
The concern is understandable. Finland has a large number of households exposed directly to wholesale electricity prices through so-called spot-price contracts, where the price paid for electricity follows short-term market prices.
Cold weather can sharply increase electricity demand, particularly because electric heating is widespread. At the same time, periods of low wind generation or outages at major power plants and cross-border connections can produce sudden price spikes.
Finland’s transmission system operator Fingrid expects electricity supplies to remain adequate during the winter of 2026–27, provided major power plants and connections to Sweden and Estonia operate normally. However, it also expects high prices to encourage consumers to cut demand during particularly cold and windless periods.
Electricity futures have also pointed to higher prices during the autumn than a year earlier. Nordic hydro reserves, geopolitical uncertainty and temporary reductions in nuclear generation have all contributed to the market outlook, although analysts have not predicted a repeat of the extreme prices seen during the European energy crisis of 2022.
Against that background, switching to a fixed-price contract before winter may appear to be an obvious form of insurance.
But Jonatan Kanervo, an economist at Finland’s Energy Authority, says the timing matters.
“Now is not the best moment, because electricity companies’ fixed-price contracts are also more expensive than they have been on average,” Kanervo told Verkkouutiset.
Fixed prices already reflect winter risks
A fixed electricity contract protects consumers from sudden market spikes and makes monthly costs more predictable.
But electricity retailers also have to protect themselves against future price movements. When wholesale market expectations for the winter rise, the cost of hedging increases — and this is reflected in the fixed prices offered to consumers.
Demand for fixed contracts can also increase ahead of winter as more households look for protection from volatile spot prices.
Kanervo says fixed-term contracts have typically been more attractively priced in spring or early summer, when electricity demand is lower and the market expects cheaper summer power.
For consumers considering a long fixed-price contract, waiting until after the winter could therefore produce better offers.
The biggest mistake, according to Kanervo, may be locking in a high price for too long.
If a consumer signs a lengthy fixed-term contract when prices are elevated, they may still be paying that rate after the market — and newly available contracts — have become significantly cheaper.
Finland saw this during the energy crisis in the early 2020s, when some households signed unusually expensive long-term contracts and remained tied to them after the worst phase of the crisis had passed.
Kanervo stresses that the current situation is not comparable with the height of that crisis, but says the underlying risk is the same.
“If fixed-term contract prices are higher than those of open-ended contracts, it is generally sensible to consider waiting before signing a long fixed-term agreement,” he says.
One alternative could be a shorter fixed contract or an open-ended agreement that allows the consumer to reconsider once winter has passed.
Spot pricing can be cheaper — but carries risk
Over longer periods, spot-price electricity has generally been the cheaper option for many Finnish households.
Consumers on these contracts can particularly benefit if they are able to shift electricity use to cheaper periods — for example when charging an electric vehicle or heating a home.
But averages do not tell the whole story.
During a prolonged cold and windless spell in early 2026, Finnish spot prices remained unusually high for weeks and at times reached 40–50 cents per kilowatt-hour. On February 3, prices briefly rose above 80 cents per kilowatt-hour.
For a household with high electricity consumption, especially an electrically heated detached home, such episodes can have a significant impact on the monthly bill.
That is why Kanervo says the cheapest contract on average is not necessarily the best choice for every household.
If a family’s finances cannot absorb sudden price spikes, a fixed-price contract may make sense even when the market timing is less than ideal.
Its main advantage is certainty: the household knows in advance what each unit of electricity will cost regardless of what happens on an exceptionally cold or expensive day.
For consumers able to tolerate substantial price fluctuations, Kanervo still considers spot electricity a viable long-term option.
He also notes that customers do not necessarily have to remain permanently with one type of contract. An active consumer who follows the market and finds attractive offers may benefit from switching between spot-priced and fixed contracts.
“If you are very active and manage to find good deals, that can be a good idea. There can be benefits from combining different types of contracts,” Kanervo says.
For households that do not want to monitor electricity markets closely, however, repeatedly trying to time the market may be more trouble than it is worth.
The key question is therefore not simply whether Finnish electricity prices will rise this winter. Consumers also need to consider how much price volatility their household finances can tolerate — and how long they are willing to commit to today’s fixed prices.