Residents in southern Norway can expect to pay record energy prices this summer, electricity price analyst Tor Reier Lilleholt has said.
“It is estimated to be the highest you have seen. A price of between 1.5 and 2 kroner per kWh, without taxes, is expected in southern Norway this summer,” Lilleholt told business and financial site E24.
However, Lilleholt added that bills were still expected to be lower overall as consumption would also dip during the summer.
Energy prices are typically lower during the year’s warmer months as the snow melts during the spring, replenishing reservoirs. Most of Norway’s energy needs are provided by hydroelectricity.
However, as there has been little snowfall this year, it is expected that the melted snow won’t refill reservoirs to the same extent. High gas and coal prices, triggered by the war in Ukraine, are also likely to contribute to high prices throughout the summer.
Aslak Øverås, information manager at Energi Norge, the organisation representing companies that produce, transport and deliver electricity, said that firms would need to plan ahead this summer.
“The power producers will arrange the water in the reservoirs so that it will last throughout the year. They will also need to consider that there is abnormally little snow in the mountains and that there is less precipitation in the spring. The alternative to keeping prices high now is that the magazines can run low, and we get even higher prices when autumn comes around,” Øverås said.