Raforkuverð

Raforkuverð is the price of electricity, typically expressed per kilowatt-hour (kWh). The term covers both wholesale prices on energy markets and the retail prices paid by end consumers, depending on the context.

Wholesale electricity prices are determined by the balance of supply and demand in the generation market and are influenced by factors such as fuel costs, plant availability, and the mix of energy sources. In markets with substantial renewable generation, weather conditions, water inflows for hydropower, and wind and solar output can cause prices to rise or fall. Retail prices usually consist of the wholesale energy price plus additional components such as transmission and distribution charges, taxes or policy levies, and the supplier’s margin.

Prices vary over time and across regions due to seasonality, peak demand, grid constraints, and regulatory changes. Consumers may be offered fixed-term contracts or many markets provide variable-rate plans tied to the wholesale price or to other benchmarks.

In Iceland, where renewable resources such as hydro and geothermal power predominate, raforkuverð has historically been relatively low for domestic consumers compared with many other European countries. Actual prices depend on contract terms, the chosen supplier, and any applicable grid charges or taxes. Large electricity-intensive industries, such as aluminum production, also influence overall demand and investment in the sector.