July 10, 2018 / 3:19 PM / 4 months ago

Warmest May since 1900 to cost Norwegians $2.34 billion more for power this year

OSLO (Reuters) - Norwegians enjoyed the warmest May this year since records began in 1900, but as rainfall has been unusually low, the treat will cost them about 2 billion euros ($2.34 billion) in higher power bills, Norway’s energy regulator told Reuters.

FILE PHOTO: People ski in Oevreseter, Oslo, Norway February 2, 2018. REUTERS/Hannah McKay/File Photo

The unseasonable weather accelerated snow melt in the mountains, but some of the water soaked into the dry land or evaporated and did not end up in the reservoirs that feed Norway’s hydropower plants, raising electricity prices.

The warmth was accompanied by 40 percent lower than normal rainfall this spring, but the thousands of happy Norwegians who flocked to sunbathe and swim now face payback in the form of higher electricity bills.

“The total cost for power this year for households, which consume 80 terawatt hours (TWh) annually, will be 1.2 billion euros higher than last year,” Vegard Willumsen, section manager at Norway’s water resources and energy directorate (NVE), said.

The added cost for Norway’s entire power consumption, including industry, corresponding to about 135 TWh in total, can be calculated in the same way, he added.

That would bring the total extra cost for power usage alone to just over 2 billion euros. On top of that, households and industrial consumers must pay taxes and grid tariff costs.

Power prices were on average 33 percent higher this year comparing to the second quarter of 2017, NVE said in a press release on Tuesday.

A number of other factors contributed to the extra power cost for Norway, such as the price of coal, gas and CO2 emissions, which made power imports more expensive.

As a result, on a household level, a typical consumer in Norway will see his annual bill rise by about 3,000 crowns ($373). NVE calculated the figure using power prices so far and its outlook for continued high prices in the future.

The downturn in spring caused Norwegian power generation and net exports to fall by 3.5 TWh compared to the second quarter of 2017. Net exports totaled only 0.4 TWh, which is unusually low during the snow melt, said NVE.

“Most of the snow has melted and we can expect less intake than usual in the future. However, the power supply in Norway is not threatened by the drought, since we have a lot of water to take off. We also have the ability to import power,” it said.

Editing by Adrian Croft

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