SFE fined NOK 3 million for balancing bids above cost (RME, 2026)
RME's decision of 24 September 2026 found that about 350 up-regulation bids SFE placed from its Mel power plant in the Norwegian regulating power market, between 23 January 2023 and 31 January 2024, were priced without a real assessment of the cost of activation. RME held that they gave, or were capable of giving, false or misleading signals about price, and fined SFE NOK 3 million.
On this page
The decision
- Authority
- Norwegian Energy Regulatory Authority (RME) (RME), Norway
- Published
- 29 September 2026
- Participants
- SFE AS
- Commodity
- Electricity
- Market
- Norwegian regulating power market (now the mFRR energy activation market)
- Conduct period
- 23 January 2023 to 31 January 2024
- REMIT equivalent
- Article 5 (Market manipulation)
- Legal basis
- Norwegian NEM regulation, chapter 5 (mirrors REMIT Article 5)
- Type of conduct
- Economic withholding
- Penalty
- NOK 3,000,000
- Status
- Appeal possible within three weeks of the decision
What RME found
RME's decision of 24 September 2026 concerns hourly up-regulation bids from SFE's Mel power plant in NO5 between 23 January 2023 and 31 January 2024. SFE offered one volume at water value and a second at a fixed, higher price. RME accepted the water-value bids as reflecting a real opportunity cost. It found that about 350 of the higher-priced bids lacked a real cost assessment. The public decision redacts the volumes and bid price; none of the high-priced bids was activated.
SFE explained that activating both bids and then deactivating both in the following hour could require a production reduction conflicting with the plant's operating rules. It described two responses: transfer the reduction to another plant, at the difference in water values plus administration costs, or accept a risk of wear and damage with a much higher estimated cost. SFE said the high bid signalled availability for exceptional situations, and that simultaneous deactivation had never happened.
What the decision turned on
Statnett referred the bids to RME in November 2023. After RME's first notice in August 2025, SFE supplied more detailed calculations. RME accepted them with doubt and narrowed the case: where the reduction could not be transferred, it accepted the higher cost. Where transfer was likely, it held that SFE should have priced the bid on that cheaper alternative. RME rejected a standard price based on the most expensive scenario throughout the year.
RME applied NEM section 5-4, Norway's REMIT-equivalent prohibition. It held that risk could be priced in, but the cost had to rest on realistic assumptions. A bid need not be visible to every participant or actually activated to give a misleading signal: Statnett, the buyer, saw it. RME rejected comparisons with day-ahead liquidity, finding that the same volume could matter more in the thinner balancing market. It found no manipulation in the associated capacity-market bids, with doubt.
The penalty
RME found it likely that correct pricing would have changed the activation order in some hours and lowered imbalance costs for other participants. It could not quantify those effects because it lacked sufficient information on the plants' water values and availability. It therefore gave economic effects no weight in setting the fine.
RME imposed NOK 3 million, finding negligence in the absence of routines to assess and document the likely alternative. It weighed about 350 bids over more than a year and prevention, while mitigating for no previous comparable sanction, cessation of the practice and the reduced scope after SFE's calculations. It found no indication of bidding to advance SFE's interests or financial benefit to SFE. It set the fine below Boliden Odda's and Energi Danmark's, distinguishing their unavailable capacity, greater fault or wider breaches. SFE could appeal within three weeks of receipt.
For a surveillance function
The decision requires a high reserve-bid price to be justified against the likely operating alternative. RME's criticism was not the inclusion of risk itself, but using the most expensive scenario without assessing when a cheaper response was available.
Sources
- RME, SFE AS - Vedtak - Brudd paa forbudet mot markedsmanipulasjon og ileggelse av overtredelsesgebyr, 24 September 2026 (Decision, in Norwegian)
- RME, SFE AS faar gebyr paa 3 millioner for markedsmanipulasjon, 29 September 2026 (Press release, in Norwegian)
Sources read on 27 October 2026. This page restates what the authority published and adds no finding of its own. A decision under appeal is not final, and its status may have changed since: check the source before relying on it.