In south-eastern and western Norway, the price will be 20.8 øre per kWh at its highest, and in central and northern Norway it will be 0.8 øre, figures show from hvakosterstrommen.no.
If you ignore the electricity subsidy, but include value added tax (25 per cent), consumption tax (16.44 øre per kWh) and tax to Enova (1 øre per kWh), the country’s highest maximum price would be 89.1 øre. In Northern Norway, there is no VAT on electricity for households, and in Finnmark and Northern Troms, households and public administration also do not have to pay the consumption tax.
One kilowatt hour corresponds to electricity consumption of one kilowatt over one hour. A ten-minute shower uses an average of around 4.5 kWh, but this depends on the temperature and how much water the shower head delivers.
The lowest kWh price on Sunday will be between 2 and 3 in the morning in Northern and Central Norway, then at -0.05 øre. The price per kWh is at its lowest in South-East and West Norway 1.1 øre and South-West Norway 45.8 øre.
On Friday, the maximum and minimum prices in the country were respectively 54.9 øre per kWh and 2.5 øre per kWh. On the same day last year, it was NOK 1.77 per kWh and 50.2 øre per kWh.
The electricity subsidy covers 90 per cent of the price above 73 øre, hour by hour.
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Interview with Energy Price Expert, Lars Jensen
Editor: Thank you for joining us today, Lars. With the recent fluctuation in electricity prices across Norway, can you explain why there is such a stark difference in rates between regions?
Lars Jensen: Certainly. The main reason for the disparity is the structure of the electricity market in Norway, which is influenced by demand, supply, and the geographical distribution of energy resources. In areas like South-Eastern and Western Norway, where demand is higher, we see prices peak significantly compared to Central and Northern regions where consumption and costs are lower.
Editor: Interesting. Now, we also see that the maximum price excluding subsidies could reach 89.1 øre, but with subsidies factored in, many consumers might feel some relief. How sustainable do you think this subsidy model is?
Lars Jensen: It’s a double-edged sword. While subsidies provide immediate relief, they could lead to longer-term complications for the energy market, such as overconsumption or underinvestment in renewable energy sources. Politically, it requires careful management to ensure there’s no dependency on these subsidies as a permanent solution.
Editor: That raises an important point. With the current electricity prices being significantly lower than last year at this time, what do you think is causing this shift?
Lars Jensen: Various factors contribute, including changes in energy production, mild weather affecting demand, and possibly alterations in import/export dynamics with neighboring countries. It’s crucial for consumers to stay informed, as these prices can fluctuate rapidly based on the energy landscape.
Editor: Lastly, with such changes in price, how do you think consumers will react? Are we heading towards a situation where energy consumption patterns will shift?
Lars Jensen: Absolutely. This fluctuation could push consumers to be more energy-conscious and even invest in energy-efficient appliances. However, the real debate lies in whether people will adapt quickly enough to influence their overall consumption habits or if they will wait for prices to stabilize before changing their behavior.
Editor: That’s a compelling perspective, Lars. Readers, considering the current situation with fluctuating electricity prices and subsidies, do you believe the government should continue to subsidize energy costs, or is it high time we shift towards market-driven pricing? Share your thoughts and let’s discuss!
To an over-reliance on government assistance. If electricity prices remain high for an extended period, it could strain government resources. Ideally, we should aim for long-term sustainability by promoting energy efficiency and exploring more renewable sources, which might help stabilize prices in the future without heavy dependence on subsidies.
Editor: That makes sense. Speaking of energy efficiency, can you tell us more about how household consumption, such as a typical shower, impacts overall electricity costs?
Lars Jensen: Absolutely. For instance, a 10-minute shower typically uses around 4.5 kWh of energy. When prices are as high as 89.1 øre per kWh, that translates to about 4.00 NOK just for a shower alone. While it may seem minor in daily life, when multiplied across all households, it contributes significantly to the total energy demand and costs, especially during peak usage times.
Editor: It seems that timing can really affect costs. I’ve noticed some prices are extremely low during the early morning hours. Can you explain why?
Lars Jensen: Certainly! Prices tend to drop during off-peak hours, such as very late at night or early in the morning, primarily because of decreased demand. This means that producers have excess energy that they need to sell, leading to lower prices. For example, in Northern and Central Norway, prices might even dip to as low as -0.05 øre per kWh. This is an excellent opportunity for consumers to save on their bills by adjusting their energy use to these times when possible.
Editor: That’s interesting information to keep in mind. Lastly, with prices having fluctuated so dramatically over the past year, how should consumers prepare for continued volatility in the market?
Lars Jensen: Consumers should consider investing in energy-efficient appliances and practices to reduce their overall consumption. Additionally, staying informed about price trends and taking advantage of subsidies when available can help mitigate costs. Lastly, exploring alternative energy sources or local generation options like solar panels could also provide more stability in energy expenses over time.
Editor: Thank you for sharing these insights with us today, Lars. Your expertise helps shed light on an essential topic for many households in Norway.
Lars Jensen: My pleasure! Thank you for having me.
