Statnett: 10% of the high electricity prices in Norway due to new foreign cables

The price effect of the two new power cables to Germany and England is around 10% of the high energy prices since last autumn, according to Statnett. In the last three months of 2021, the electricity price averaged 126 øre per kWh.

“In the public debate, it is presented as if the two new cables are the main reason for the record high electricity prices we have seen this winter. Our calculations show that this is not true. Many other factors have contributed to the high prices,” Executive Vice President Gunnar Løvås of Statnett said in a press release.

Gas price most important factor

He points to the increase in gas prices as the biggest factor behind the increased electricity prices. During the autumn of 2021 and into the winter, gas prices multiplied many times over, coal prices also increased significantly, and the quota price for CO2 emissions has more than doubled. At the same time, there was little water in southern Norwegian reservoirs.

According to Løvås, it is especially in periods of extreme prices that the new cables have a greater effect than usual.

“Then the price in Southern Norway will, in any case, be very high, even in a situation without the new cables. History shows that Norwegian and German electricity prices had moved in step over the past twenty years, long before the cable to Germany came into place,” he said.

Expecting periods of import

According to Statnett, the price effect of the cables will be smaller over time, by approximately 3–4 øre per kWh. In the years ahead, they also believe that there will be more periods of import.

In the autumn of 2021, Statnett started trial operation of the world’s longest submarine power cable North Sea Link between Norway and the United Kingdom. 

The cables have an output of 1,400 megawatts (MW), which is more than Norway’s largest hydropower plant.

In the spring of 2021, the submarine cable connection Nordlink, between the Norwegian and German power markets, also came into ordinary operation. The cable connection has a capacity of up to 1,400 MW.

Source: © NTB Scanpix / #Norway Today / #NorwayTodayNews

Do you have a news tip for Norway Today? We want to hear it. Get in touch at [email protected]