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ENERGY

Norwegian gas plant back in service after fire

Norway is Europe's second-biggest supplier of natural gas behind Russia and key to ensuring energetic autonomy for the continent. Its sole liquefied natural gas plant is operating once again after being ravaged by a fire in 2020.

Norway's sole liquefied natural gas plant is located in Hammerfest, in the north of the country.
Norway's sole liquefied natural gas plant is located in Hammerfest, in the north of the country. Now that it is back in service, it is hoped that Europe will be able to reduce its dependency on Russia. (Photo by JOHN HUGES / AFP)

Norway’s sole liquefied natural gas (LNG) unit has been restarted after a 2020 fire and will soon begin production, energy company Equinor said Friday, a move expected to help increase exports to Europe.

Norway is Europe’s second-biggest supplier of natural gas behind Russia.

Production at Equinor’s plant in Hammerfest in northern Norway, which makes it possible to deliver gas by ship in liquid form, is to help Europe cut its dependency on Russian gas after its invasion of Ukraine.

“We have completed the repair work on the plant, we have completed the testing… and we have now started the cool-down process,” Equinor spokesman Gisle Ledel Johannessen told AFP.

“It will take some time to finalise the cool-down process. The next step is to get the liquefied natural gas on the tanks”, he said.

Johannessen would not specify when that could happen, but said it was “a short time frame”.

The site, damaged in a September 2020 fire, produces almost 4.65 million tonnes of LNG per year, according to Equinor.

Norway announced steps in March to keep its gas production at maximum levels to help Europe reduce its Russian dependency.

Among other things, the Norwegian Petroleum and Energy Ministry agreed to adjust the production licences of three offshore fields so that they can prioritise gas production over oil.

But its exports have been squeezed by production capacities, already churning at maximum levels, and the distribution system via pipelines.

It is hoped the Hammerfest unit will make it possible to increase export volumes.

Norway covers between 20 and 25 percent of the European Union’s and Britain’s gas needs, while Russia currently supplies around 40 percent.

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ENERGY

ENERGY: What Norway’s new grid rent model means for you

A new model for grid rent, the fee you pay the network for powering your home, will be adopted in Norway later this year. So, what will it mean for you, and will it help slash your energy bills? 

ENERGY: What Norway's new grid rent model means for you

Following a six month postponement, a new gird rent system will be adopted nationwide in July, the Norwegian government has announced

Grid rent is the charge consumers pay for receiving electricity into their homes. Under the current model, grid rent is typically anywhere between 20 to 50 øre per kilowatt-hour. Those in rural areas usually pay more, while those in cities pay less.

The new model will have a lower fixed proportion of the fee with a higher part of the charge linked to total consumption, meaning homes that use more power will pay higher grid rent, while those that consume less will have lower bills. 

The new model has been welcomed by the Norwegian Housing Association (NBBL). 

“Now we get a fairer grid rent, where those who load the power grid the most so that the need for development increases, pay somewhat more in fixed terms than those who use little electricity at the same time,” Bård Folke Fredriksen, CEO of the NBBL, told newswire NTB. 

“No one wants to pay for the neighbour to charge two electric cars simultaneously during the day, when it is entirely possible to charge slowly at night when there is good capacity in the power grid,” he added. 

Initially, the model was meant to be adopted in the new year, but a majority in parliament opted to delay the scheme’s introduction. 

“The goal of the new grid rental model is to facilitate the best possible utilisation of the transmission network and a more equitable distribution of costs between customers,” Minister of Petroleum Terje Aasland said in a government statement.

The government has said that, over time, the scheme would lead to lower grid rent for customers. 

“Power-based grid rental will provide incentives for efficient grid utilisation, which will result in lower grid costs for electricity customers, less encroachment on nature and fewer conflicts related to grid development,” Aasland said. 

A transition period of two years will be introduced, and the new consumption charge will only be allowed to account for 50 percent of grid companies’ revenues. The energy ministry will then assess the new model at the end of the transition peroid. 

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