Did Norway really pay residents for using electricity? Yup. Here’s what happened

Electricity light bulbPhoto: Diz Play / Unsplash

It’s a rare occurrence when people get paid to use a utility like electricity, and not the other way around. Rare… But possible.

An out-of-the ordinary situation occurred around Oslo and Kristiansand during the night from November 1 to 2.

Negative electricity prices

Norway actually paid Norwegians to use electricity, because electricity prices fell below 0 for a period of time.

What caused them to go negative?

A number of factors influenced the decline in price. These included:

  • Heavy rainfall in recent weeks
  • Strong winds over the past month
  • Increasing imports from Sweden of nuclear power
  • Higher-than-usual autumn temperatures

Norway’s electricity is largely hydropower-generated. The country has one of the highest rates of hydropower use for electricity in the world.

In September of 2020, Norway produced over 91% of its electricity from hydropower, about 7% from wind power, and around 2% from thermal power.

Statistics Norway’s latest annual electricity report is from 2018; it states that hydropower produced 95% of all Norway’s electricity that year. So, we can see why some of the above factors would influence prices.

Other factors contributed to lower demand, which also influenced prices.

An almost unprecedented situation

This was only the second time in history that Norway marked negative electricity prices.

The first time it happened was July of 2020. In July, prices became positive again within an hour. The reasons the first time around included:

  • The summer holiday period, during which electricity use is normally lessened
  • Large amounts of snow in the mountains of Norway
  • Fewer electricity exports

The second time, this Monday night, negative prices lasted from 1AM to 5AM. Electricity prices were in the minus for four whole hours.

In numbers

People affected by the situation in Southern Norway received up to two øre per kilowatt-hour.

One øre is worth one hundredth of one Norwegian krone. Think of it as Norway’s version of the cent.

kilowatt-hour equals one kilowatt of power, sustained for one hour. It’s not the amount of kilowatts used in an hour. Rather, this is a unit of measurement, and it often doubles as a billing unit for electricity.

Here’s what electricity prices totaled for four hours during the night of November 1 to 2:

  • 1AM to 2AM: -0.44 øre per kilowatt-hour
  • 2AM to 3AM: -1 øre per kilowatt-hour
  • 3AM to 4AM: -1.9 øre per kilowatt-hour
  • 4AM to 5AM: -1.5 øre per kilowatt-hour

Watt a situation, right?

It’s unlikely that electricity prices will become negative again in the near future, however. Norway will soon see winter, and with it, increased power usage.

Source: Norway Today

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