Electricity prices are falling in the North, partly after wind power production has rebounded. Southern Norway now has more expensive electricity than the rest of the northern region.
In southern Norway, electricity customers pay ø99 per kWh for electricity on Fridays, excluding grid rent, fees and surcharges.
It’s more expensive than in other Nordic countries – but cheaper than in the Netherlands, Germany and the UK.
Also on Thursday, the cost of electricity in southern Norway was higher than in neighboring countries, and Norway imported electricity for part of the day. Norway has a number of power lines and cables for countries such as Sweden, Denmark and the Netherlands.
– Now we get cheap electricity from the neighbors around us. When there is a lot of cheap wind in the neighboring countries, we can import. The weather is very choppy in the fall, and it can have unstable winds, says energy analyst Tor Reier Lilleholt at Volue Insight to E24.
Thus, electricity prices can vary greatly in line with future wind energy. The price of electricity in southern Norway reached 1.23 Norwegian kroner per kilowatt-hour at the highest level, but has now fallen to less than one kroner per kilowatt-hour, according to the Nord Pole energy swap. In the rest of Norway, the price is still much lower.
Here are Friday’s prices:
- Southern Norway: 99.6 µl/kWh
- Central Norway and Northern Norway: 51 øre per kWh
- Sweden: 79 kWh, 57 kWh in parts of the country
- Denmark: 94 kWh, 79 kWh in parts of the country
- Finland: 78 øre per kWh
More valuable to save water
Lillholt points out that the water in the tanks is highly valued during the day, because it doesn’t rain much. With low flow, the power industry will save water to be able to produce electricity later this winter.
The analyst notes that if there is no more water in the future, there should be progressively fewer hours as Norway releases energy.
– Then the price will have to rise to the level in Europe, and we are not there yet, he says.
Here are the prices in some other European countries on Friday:
- The price of German electricity is 1.10 NOK. The power cable between Norway and Germany is out for maintenance this week, so the German price has not affected the Norwegian
- In the Netherlands, the price is 1.58 NOK per kilowatt-hour. Norway is connected to the Netherlands via the Norned power cable
- In the UK, the price is 1.47 NOK. It will connect Norway to the UK with the trial run of the North Sea Link cable from October 1
Fill magazines less than usual
Water tanks drained a lot for the season, averaging 63 percent, according to the NVE. In southwestern Norway, the carrying capacity is only 53 percent on average. There have been reports of somewhat wetter weather, and the market is now anticipating a drop in prices.
German contracts for electricity for delivery in the fourth quarter fell from about NOK 1.50 to about NOK 1.40 per kilowatt-hour. Norwegian energy contracts for the fourth quarter fell to 73 øre per kilowatt-hour, from around 90 øre a week ago. Lilleholt thinks the market is very optimistic.
– I don’t understand why prices will go down in the future. The weather forecast is getting wetter, but the volume is too small to mean anything special, he says.
According to NVE stats Again, there is a capacity of about 55 terawatt-hours (TWh) in the tanks, and they can be refilled to some extent, depending on how much rain is coming in (inflow). Last week, Norwegian companies produced 2.7 TWh of energy, according to Statnett’s stats.
The magazines are more depleted, but NVE don’t worry: – We’re only in mid-September
– indifference attitude
Reservoirs are at their lowest in March and April, and fill can be very low this year with little rain, severe winters, and late spring thaws. Lilleholt believes authorities should be prepared for extraordinary years, when there is not enough precipitation and challenges with a very low fill. It happened in parts of the country in 2003.
It is neglectful to say that there will always be rain in the fall. One has to be prepared for situations where it doesn’t, and not act too late, he says.
At its worst in 2003, reservoir filling in southern Norway (NO1) fell to 5.5 percent in spring, below the level Lilleholt considers critical. He notes that there is likely to be a sharp drop in the spring of 2022 if nothing happens to the weather.
We have a forecast of less than nine percent in southern Norway. I consider seven percent critical. There’s not a lot of TWh that’s going to disappear before we get to that level, says Lilleholt.
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