Cheaper electricity saved electricity customers billions of dollars.
Norwegian Water Resources and Energy Directorate (NVE) estimates that a typical household customer in southern Norway has saved about 1,200 dollars on energy bills so far this year, including VAT calculated and compared to last year. The estimate applies to customers with power contracts linked to the price of the Nordic power exchange.
The savings varies considerably between price areas in the electricity market. In Mid-Norway has publicly customers so far this year saved around 700, while in northern Norway is saving for a typical customer only 550 million, estimates NVE. The differences between regions due to bottlenecks in the grid so that power does not flow freely and equalizes differentials.
In the Nordic power exchange Nord Pool exchange price in Oslo and the rest of southern Norway in the first seven months was about 30 percent lower than last year. Stock price at around Oslo were on average 30 per cent. kilowatt-hour (kWh) for the first seven months of this year. This year, the average has been just over 21 cents / kWh. This is the pure power price exclusive of VAT, other taxes and tariffs.
Lots of snow
With stable underlying demand is the weather that largely determines prices
– There was plenty of snow in the mountains in winter, and we had no severe cold spells. Moreover melted snow as normal this year. Last year we had an unusually cold spell in April, so that consumption increased. In addition, snowmelt delayed and hence, energy prices remained relatively high, says advisor Martin Andreas Vik in NVE.
In addition, technical aspects electricity customers in southern Norway for good.
– Maintenance of power cables over the Oslofjord limited opportunities for export. It closed in some of the power and soft power prices in southern Norway, said Vik.
Outside Exchange
But not all have contracts that follow the stock prices. Around 40 percent of household consumption is linked to other types of contracts. There are essentially contracts where the price of power just follow the main features of the stock price and then with a lag. For such contracts, estimates NVE savings so far this year to more than 700 million with a typical consumption.
By taking into consideration the regional price differences and the proportion of different types of contracts the savings for all households is estimated at just over 2 billion So far this year, given an annual consumption of 20,000 kilowatt-hours (kWh) and inclusive of VAT.
In the average of all households are saving so far this year more than 900 million.
Easing from the sky
Lower energy prices makes more money in your pocket to spend on other things.
It works the same way as tax cuts from the finance minister Siv Jensen. This year, she has cuts that vary widely by income, but is estimated at 1,200 million on average per. taxpayer.
For the many among people who earn up to 450,000 dollars for tax relief on average 100-600 dollars on the different income levels. Even with two incomes in a household and two tax cuts, can thus low electricity cut electricity bills more than tax cuts when the year is over.
Producers and Flå boxes taper
There is money saved on energy bills for most people, reduced revenues for power producers, although some probably have secured against short-term effects of lower prices.
Households account for roughly one third of consumption. Energy intensive industry, and government / the rest of the business sector also accounts for about a third each.
The power industry is largely based fixed, long-term rates. However, shipments to the rest of the industry and the public sector will lower the market turn into at different times, and mean lower revenues in addition to the loss of income from households.
On the other hand, production has increased by 6.7 percent So far this year, and thus offsets some of the fall
– Lower prices result in lower earnings. So far, it appears that 2014 will be weaker than last year, says CEO. Director Oluf UlsethFlashPlayer in industry organization Energy Norway.
He said the board, the owners and management of almost all power producers are now discussing dividend levels.
– We are moving into a new reality of lower profits, he said.
Prices 2014 points forward towards the future.
– Futures prices tell a expected surplus of power in Norway and Scandinavia, forcing down prices, says UlsethFlashPlayer
Almost all manufacturers are owned by municipalities, counties and the state. Lower profits means less dividends paid to municipal funds and thus less money to good causes. In local government interest group KS is the most worried.
– This is important for many municipalities and counties, and will be felt significantly. We have already seen reports of lower dividends for 2014, says director of policy interest in KS Helge Eide.
Kraft manufacturer BKK is owned by Bergen municipality and other municipalities in the region. The Board has in a letter to the owners announced that the dividend will be approximately NOK 400 million over the next five years, while it was 800 million in 2013 accounts.
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