No light, no charge: Norway risks freezing in darkness
Europe's energy supply has two woes: windlessness and Norway's reluctance to share its electricity with the rest of Europe. At the end of the week, the cost of a kilowatt-hour in this Scandinavian country reached a 15-year high of €1.1328. Izvestia investigated whether Oslo will bail out continental Europe in conditions when "we need it more ourselves".
Save who you can
When the European Union imposed tough sanctions on Russian crude oil, Norway made grandiose promises to "save Europe from the energy crisis by making its oil and gas available to the EU". The current situation once again brings to mind the proverb: "To promise is not to marry".
The hopes for a free life without Russian gas, which were aroused in the "Commonwealth of the Twenty-Seven", have so captivated the population of Europe that no one paid attention to the warnings of some analysts that Scandinavian energy resources are not enough to cover European demand.
And today, Norway must reduce its supply to Europe if it wants to stop the price of electricity from rising domestically.
European Commission Vice-President Maroš Šefčovič, at a briefing on the results of the third tender for the joint purchase of liquefied natural gas (LNG) in the EU since the beginning of the year.
At the beginning of 2023, the Norwegian government issued several licenses for exploration of new oil fields. Actually, this contradicts the program of abandoning fossil sources in electricity generation and is a violation of the order of transition to "green energy" and fulfillment of decarbonization obligations. But Oslo explained that such a deviation from the general line is necessary, because in the current geopolitical situation these licenses are vital both for Norway itself and for Europe.
"Now Oslo prefers to prioritize domestic energy supplies in order to keep the price of Norwegian-generated electricity low. Because of this, the continent is facing big energy problems," notes Spanish business publication El Economista.
Your shirt is closer to your body
The two leading parties in Norway's government coalition (the Workers' Party and the Center Party) want to cancel the agreement with Denmark, under which Oslo pumps part of its energy production to Copenhagen. The minority coalition partner (the Socialist Left Party) believes that this cannot be limited to this: the existing energy ties with the UK and Germany should also be renegotiated. Because exorbitant electricity prices within this Scandinavian country could become even higher if Norway pumps its electricity on "critical days" to neighboring states.
Windless weather in Germany and the North Sea (where wind turbines are installed) caused electricity prices in southern Norway to reach a peak of NOK13.16 (€1.1328) per kilowatt-hour on Dec. 19. This is the highest level since 2009 and almost 20 times higher than the previous week.
"The situation is absolutely shitty," Norwegian Energy Minister Terje Osland said emotionally and without much concern for "parliamentary" expressions. - We have lived for decades in a situation where light prices were comfortable, now things have taken a turn for the worse and there is no certainty that it will get better soon."
The Workers' Party has announced that one of the points in its election platform, with which it will go to parliamentary elections next September, will be a commitment to disconnect the interconnection with Denmark. The current agreement to pump electricity to the Danes runs until 2026 and can be extended automatically if the parties are not opposed.
Critics believe that it is exports that Norway owes the rise in domestic electricity prices. The issue has raised concerns in the European Union, as the bloc relies heavily on Scandinavian-generated electricity to balance energy prices on the continent.
The Hammerfest LNG plant of oil and gas company Equinor in Norway.
"This is a critical moment for EU-Norway relations. Cutting energy ties with Europe will not be well received," said the EU ambassador to Oslo, quoted by the Financial Times. Brussels insists that the European electricity market must be integrated, mutually beneficial and focused on instant help from some participants to others.
"Norway also sometimes imports electricity through interconnectors when it needs it," the EU capital reminded.
Staying on the sidelines
Experts believe that the current government will lose the upcoming elections and that the right-wing Progress Party, currently leading in the polls, should come to power. Which favors breaking relations with Denmark and reforming agreements with the United Kingdom and Germany to avoid what they call a "price contagion" coming from the continent.
The phenomenon, known meteorologically as Dunkelflaute ("dark windlessness"), has already caused the cost per megawatt-hour at peak load times to rise to €1,000 in Germany. In Spain, the jump is smaller in absolute terms, but in relative terms the increase is also impressive and painful - up to €146 (Dec. 17) from €68 in October.
Norway is one of the largest producers of gas (112 billion cubic meters per year), which is enough to meet both the country's industrial and domestic demand for electricity. But the current reality is this: skyrocketing demand for light from its neighbors and a drop in renewable generation capacity in Europe has driven up the price of energy on the exchange by 143% to €50.33 per megawatt hour. At the end of October last year, a megawatt-hour cost €26.
The world's largest German chemical company BASF in Ludwigshafen (Germany)
It should be said that the rise in the price of light is not a trend common to the entire Scandinavian country. It is characteristic mainly for the southern regions of Norway, from where energy is pumped to continental Europe. In the north and west, the situation is still close to last year's, but ... Almost no one lives there. Almost all of Norway's population is concentrated in the south - in Oslo alone and its suburbs there are 40% of the human population. And for them, such a surge in prices, even if far from what they are experiencing in Berlin today, is a real shock. This is a key moment for Europe, because Norway is fully integrated into the continent's energy system and supplies it with a huge amount of electricity.
Norway is the energy pillar of Europe
Norway was the absolute leader in all of Europe in hydroelectric power generation with 137 TWh. The entire Old Continent as a whole produced only 637 TWh from this source. Its neighbors, such as Denmark and Germany, have been aggressively developing wind power in recent years, in full compliance with the EU's Green Transition program and in a haste to abandon nuclear power plants and shut down "dirty" coal-fired power plants. Eolica accounts for 20% of Germany's total electricity production, 15% in the Netherlands and up to 40% in Denmark.
"When the wind died down, Europe's electrical system had to launch all possible and available sources of production to meet demand," the Spanish edition quotes the portal Volue Insights, whose experts analyze the energy market in Europe. - Norway, which traditionally lives on energy exports, has strained to meet the increased demand. And, perhaps, even overstretched and torn".
Troll gas production platform in Norway
The European energy crisis is likely to last until the end of February, according to experts interviewed by El Economista. That is, Norwegians will have to experience the dubious pleasure of paying double price for light for almost three more months. Norwegian parliamentarians daily express in the press of the country incomprehension, how under the condition of overproduction of electricity and the possession of an unconditional first place in the supply of energy carriers to Europe (30% of gas imported by the EU today is of Norwegian origin), residents of Oslo and other cities of the country will have to pay prohibitive invoices for light. It is not necessary to have an economic education to realize that it is more profitable for electricity producers and gas producers to take advantage of the high European market prices for their products than to heat their fellow countrymen for pennies.
Переведено сервисом «Яндекс Переводчик»
