More stable electricity prices
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- 12 June 2003
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Rain and snow in Norway and Sweden last winter caused electricity prices to rise to record highs. For Arla Foods this meant a DKK 40 million increase in electricity charges compared to the 2002/03 budget.
To counteract a possible repeat scenario this year, Arla Foods has adopted a new purchasing policy.
Whereas Arla Foods previously purchased electricity on the spot market, Arla Foods Global Purchasing has now switched to fixed prices.
This means that the price of electricity for the winter (October-April) will be decided some months before winter sets in. As for the summer’s consumption, 50% will be at fixed prices while the remaining 50% will be at spot prices.
In practice, small pools of electricity will be purchased on the electricity exchange, Nordpool.
In the longer term, the new policy is expected to bring greater stability to electricity purchasing.
Arla Foods is an international dairy company owned by 9,700 farmers from Denmark, Sweden, the UK, Germany, Belgium, Luxembourg and the Netherlands. Arla Foods is one of the leading players in the international dairy arena with well-known brands like Arla®, Lurpak®, Puck® and Castello®. Arla Foods is focused on providing good dairy nourishment from sustainable farming and operations and is also the world's largest manufacturer of organic dairy products.