Operations Other

On 20 November 2025, Sweden's regulator Ei and Lithuania's regulator NERC approved a joint proposal by Svenska kraftnät and Litgrid to introduce long-term financial hedging instruments on the SE4–LT border, marking the start of implementation. Under the approved arrangement, the two TSOs commit to making at least 10% of the NordBalt interconnector's capacity — approximately 70 MW — available annually to underpin cross-border Electricity Price Area Differential (EPAD) contracts. The instruments will be offered to wholesale market participants from 2026, providing the first cross-border EPAD solution of its kind in Europe, with similar contracts previously available only within the domestic Swedish and Norwegian markets. The regulators concluded that risk-management opportunities in SE4 and Lithuania were limited and that participants lacked effective tools for price hedging; allocating NordBalt capacity directly underwrites the new contracts and strengthens regional market integration. The decision was publicly announced by Svenska kraftnät on 19 December 2025. The arrangement does not alter NordBalt's physical transmission capacity but reserves part of it commercially to backstop the hedging product, anchoring the link as a structural component of Baltic–Nordic market integration following the Baltic states' synchronisation with the Continental Europe Synchronous Area in February 2025.