In a dramatic shift of energy policy, Norway’s ruling coalition parties are pushing to disconnect power links with Denmark and potentially renegotiate agreements with the UK and Germany as domestic electricity prices reach unprecedented heights.
Southern Norway is experiencing a severe energy crisis, with electricity costs surging to NKr13.16 per kilowatt hour – the highest since 2009 and approximately 20 times higher than previous week’s rates. The situation has prompted Energy Minister Terje Aasland to describe it as an “absolutely shit situation.”
The centre-left Labour party’s campaign strategy for the 2024 parliamentary elections includes plans to terminate electricity interconnectors to Denmark when they expire in 2026. Their coalition partner, the Centre party, supports this stance and advocates for reassessing existing power links with Britain and Germany.
These interconnectors face mounting criticism as they are blamed for Norway’s soaring domestic prices. Critics argue that Norway should prioritise maintaining low domestic rates before exporting its hydropower resources, reflecting the country’s historical approach to energy management.
EU nations have expressed significant concern about these developments, with one EU ambassador in Oslo stating that this represents a “crunch moment” for EU-Norway relations. The European Union emphasises the importance of an integrated electricity market and reminds that Norway also benefits from these connections during periods of energy shortfall.
The issue has become increasingly politicised, with polls suggesting the current centre-left government may face defeat in next year’s elections. The right-wing Progress party, currently leading in polls, supports severing Danish connections and reforming agreements with the UK and Germany to protect Norwegian consumers from continental price fluctuations.
While Norwegian consumers currently receive government subsidies covering 90% of electricity costs above a certain threshold, the Progress party advocates for complete coverage above a lower price point, citing the state’s substantial revenue from hydropower generation.
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