– Unfortunate for both customers and industry – E24

The significant differences in electricity prices between northern and southern Norway have been a recurring topic force conference In Rognan in Nordland this week.

The price level is much lower in the north of Norway than in the south. This fall, electricity prices in southern Norway set new records for the year, causing problems for consumers and the industry.

– There is a big difference in prices, compared to last year when it was very low, says region energy director Knut Lockert for E24.

District Energy represents a number of smaller companies in the district energy industry. Lockert believes that large price differences between northern and southern Norway could create problems.

– What is unfortunate for both customers and the industry is that there is a difference between north and south in price. He says I hope this situation will not be continuous.

– You mean, like, salt and their ilk, eh?

– It can make noises. We see that there is customer noise when there’s a big difference in grid rent between regions, and we think the same can happen when it comes to electricity prices, Lockert says.

District Energy has proposed an equal grid lease to all grid customers. Some network customers can pay up to 30 øre per kWh more than others in network rent.

This summer, electricity prices in southern Norway were extraordinarily high. The Nord Pool’s energy exchange rate has been more than 1 kroner per kilowatt-hour (excluding grid rent and fees) for eight of the past 10 days.

refuse greed

The price of energy is determined by a number of different factors, and some find it difficult to understand why factors such as rising carbon dioxide quotas, gas prices and coal prices in Europe are sending the price of Norwegian hydropower to the roof.

– What do you want to say frustrated or cursed from the high electricity prices?

– I think no one should forget that it was so cheap last year, and that will change. To the extent that something can be done with free-market prices, you go in and do something that can be done in the long run, like looking at bottlenecks in the power grid, Lockert says.

If someone thought you were greedy, what would you say about that?

– This is a mistake. The price in the market is determined by many factors. If you have that approach, there have been a lot of respectable owners in the last year, who have almost given up power, Lockert says.

According to Statistics Norway, the price of electricity last year was the lowest in 18 years.

– It can change quickly

NVE Director Kjetil Lund also made the trip to Rognan on Tuesday, and electricity prices were one of the many topics he covered in a post during the Power conference.

– It is true that prices are currently high, especially in southern Norway. Here in northern Norway, we find it significantly lower, Lund tells E24.

– That could change quickly this fall. Lund says that if the hydrological balance changes and we get higher wind production in northern Europe, it will help bring down prices.

According to the peer, the reason for the high prices in southern Norway is the lack of water in Norwegian reservoirs, especially in western Norway, along with the high prices of coal, gas and carbon dioxide in Europe, which leads to higher prices.

Expect more sudden changes

The NVE director notes that Norwegian electricity customers received very cheap electricity last year, when Norway also experienced negative rates for the first time. On the other hand, prices have soared this year, and Norwegian electricity customers have seen the most expensive August electricity ever.

He points out that the energy system depends on the weather, and that the share of solar and wind energy will increase in the European energy mix, at the same time as carbon dioxide prices will increase.

– Perhaps this means that short-term prices will be more different than they are today. In periods when gas and coal are the marginal product and the person who sets the price, prices can be really high, he says.

– In other periods, with a lot of wind and sun production, prices can be really low, even zero. The weather is different as we know. We’re likely to see more of these sometimes sudden and powerful changes, says Lund.

– two out of three

At the energy conference, Lund stated that Norway faces many choices in energy policy, where new energy developments and encroachments must be weighed against the desire for new green jobs and lower electricity prices.

Most of us want lower power prices, depending on which side of the cash register you’re sitting on. Most of us also want a great deal of energy for new green industry and value creation, which we see a lot here in Nordland, and for electrifying the transportation sector, among other things, Lund says.

In addition, most of us want to avoid new developments and new encroachments on nature. We can fulfill two of these wishes, but not all three. So there are some trade-offs here, he says.