Distriktsenergi and Småkraftforeninga are asking the government to take action to reduce the differences between the North and the South.
The price shock in winter particularly affected customers in the south who receive ratings nine billion in government energy support. In North Dover, people pay much less for electricity, and so far they receive no subsidies.
The price differentials also affect the revenue of the energy industry.
-This picture of energy producers earning so much, it applies only south of Dover, but not north of Dover, says District Energy General Manager Knut Lockert to E24.
District Energy regulates, among other things, district energy companies. In a letter to the Ministry of Petroleum and Energy, they asked the government to form a separate committee to find out how the price differentials can be reduced.
The organization believes that the planned energy commission will likely address this problem.
– So we have recorded that this matter should at least be addressed there if the government does not choose to form a separate commission, as we suggest, says Lockert.
“We don’t think the current situation is best for AS Norge in the long term,” he says.
100 NOK per liter of gasoline
Last year, Lockert thought it was as if gasoline should cost ten kronor a liter in Trondheim and 100 kronor a liter in Oslo. The organization requested a response from Statnett, which operates the largest transmission lines in the power grid.
We test that we don’t get proper answers to our questions, says Lockert.
When we don’t get definitive answers from Statnett about solutions to challenges, we should get other players on the field to point out opportunities to reduce these price differentials, especially to reduce the price where it is highest, he says.
Statnet recently said Distriktsenergi indicates in its letter to the government that there may be price differences of up to 30 øre per kWh between the south and the north until 2026.
“This is in contrast to previous scenarios by Statnett which put the spread at around 10 øre in a normal year. The organization wrote that there would be noise from this if it continued.”
We will no longer choose
Minister of State Amund Vik (Labour) in the Ministry of Petroleum and Energy will not immediately promise to establish a commission, or that questions will be included in the energy commission’s mandate.
– We are delegating the commission, and it should be allowed to return to these questions, Vic says in a comment emailed to E24.
The League of Small Powers shares Lockert’s concerns about large spreads. Its members also have very different incomes depending on whether they are located north or south of Dover.
We give our full support to the initiative from Knut Lockert and Distriktsenergi. What happened this fall with electricity prices revealed a number of unfortunate aspects of the way we organize the energy system. We must dare to talk about it, says General Manager Knut Olaf Tveit in Småkraftforeninga to E24.
Statnett’s Final Analysis: Today’s High Electricity Prices Won’t Last
risk of selling at a loss
North of the high prices you will find, among other things, the energy company Svorka in Indre Nordmøre. The company has 70 employees, an annual turnover of about NOK 200 million and operates Power plant In the municipalities of Surnadal, Rendal and Halsa.
– I think we can’t live with this kind of spread. As now, force in central Norway and the north was not properly used. I don’t quite understand the explanations for how it came to be, says CEO Halvard Feldfer on Sforka to E24.
Mountain weather is also Chairman of Board of Directors area energy.
Energy companies often try to secure some of their sales power in advance. When the price in the local price zone is very different from the so-called system price, it can sometimes result in companies having to pay for electricity supply.
We lose a lot of money on our energy contracts. It was supposed to be a predictable thing, but when the market turned, this suddenly became too risky for us. For total production in December, for example, we had negative operating returns, Feldfer says.
Not a valid currency
According to Tveit, members of Småkraftforeninga are also significantly affected.
– Honestly, I have members on both sides of the Fjord, with the same production, but where the difference in income is the tiger. We like this to be more balanced, he says.
– I don’t think the cost of a shower in Oslo is more than ten times the cost of a shower in Trondheim from the common currency in Norway. What we’re seeing now can slow and possibly stop the green transition and in the worst case destabilize democracy, he says.
Tveit believes what consumers have suffered this winter is unacceptable. He believes Statnett and the energy industry should be open to discussing how to improve the system.
We have served the market well, and we are counting on the market to unleash more energy. But consumers must be protected from price effects, Tveit says.
– It must be strengthened
The E24 website asked the government if price differentials in 2021 would be acceptable. Minister of State Amund Fick responded that the price difference was due to limitations in transmission capacity, and that Statnett was working to strengthen the network.
– Statnett points out that strengthening the network between the north and south of the country is expensive and time-consuming, and it’s not a single project, he said.
Svenska kraftnät plans to increase capacity in the Swedish electricity grid. According to Statnett, this will be important along with promotions in Norway to reduce north-south price differentials, says Vik.
Can last until 2028
According to Lockert, the Swedes should have done something in the so-called “intermediate” between North and South in 2024, but it was pushed back until 2028.
– People in the industry say there has to be something more you can do with these North-South connections before then, but we don’t get good proposals for solutions from Statnett, he says.
What specific actions are you calling for?
– One thing to look at is why the Ørskog-Fardal power line is used as little as possible. We should also discuss how far one can go in pushing capacity into the network during periods of high price differences, Lockert says.
Statnett previously said it was strengthening the north-south network and other measures, but even the strongest network won’t resolve the situation with severe spreads this winter.
– There was a period of very large price differences in the energy market, and that’s something we’re not happy with, Statnett’s System and Market Manager, Gunnar Løvås told E24 in September.
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