How do the transmission and sale of electricity differ from each other?

Satunnainen

Transmission and sale of electricity are two separate but related functions in the electricity market. Understanding these functions is important for consumers to make informed decisions about purchasing electricity and managing costs. In this article, we look at how the transmission and sale of electricity differ from each other.

Transmission of electricity

Transmission of electricity means transporting electricity from the place of production to consumers. This process requires a large infrastructure consisting of power lines, transformers and distribution stations, among others. Transmission network companies, which own and maintain this infrastructure, are responsible for the transmission of electricity.

  • Transmission companies: These companies are responsible for transporting electricity from high-voltage networks to local distribution networks and finally to consumers.
  • Transmission fees: Consumers pay transmission fees to transmission network companies for transporting electricity. These fees are separate from the selling price of electricity and are based, among other things, on the amount of electricity consumed and the maintenance costs of the transmission network.
  • Regulation: Transmission of electricity is a highly regulated activity, and the operations of transmission network companies are supervised by national authorities, such as the Finnish Energy Agency.

Sales of electricity

Selling electricity, on the other hand, means acquiring and selling electricity to consumers. Electricity sales companies buy electricity from the wholesale market and sell it on to households, companies and other end users.

  • Sales companies: These companies do not own transmission networks, but focus on purchasing and selling electricity. Consumers can freely choose which sales company they buy their electricity from.
  • Selling price: The selling price of electricity consists of the wholesale market price of electricity, the selling company’s margin and possible additional services. The sales price can vary greatly between different companies and contract types.
  • Market: The sale of electricity works in a competitive market, which means that consumers can compete with electricity sellers and choose the cheapest or most suitable option for them.

Summary

In summary, it can be stated that the transmission and sale of electricity are two separate but complementary functions. Electricity transmission focuses on transporting electricity from the production site to consumers and is a heavily regulated activity. Electricity sales, on the other hand, focuses on the purchase and sale of electricity to end users and operates in a competitive market. It is good for consumers to understand the differences between these functions so that they can make informed decisions about purchasing electricity and manage their costs effectively.

More information on the transmission and sale of electricity can be found, for example, on Energiavirasto‘s website.

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