Could Norway take new steps to address high energy prices?

Norway’s Prime Minister Jonas Gahr Støre is under increasing pressure to take additional action on sky-rocketing energy prices.

Could Norway take new steps to address high energy prices?
A reservoir on northern Norway. The government is considering new responses to high energy prices in the country's south. Photo by Bjørn Kamfjord on Unsplash

Local and national politicians have joined increasing calls for the Norwegian government to take additional action to address high energy prices.

Støre met on Tuesday with Labour mayors to discuss high energy prices. Oil and Energy Minister Terje Aasland also attended the talks, which came after the Labour mayors in Kristiansand and Stavanger criticised the PM and demanded new measures to deal with rising electricity prices. 

“I think we have to accept that this won’t be over anytime soon,” Støre said earlier this week.

“It could take one or two or three years,” he said.

The presidency of Norway’s Storting parliament will meet at the beginning of next week to decide whether lawmakers should be urgently recalled over the issue. 

The Norwegian Confederation of Trade Unions (LO), the PM’s biggest ally outside of the government, has also said that high prices need to be addressed. 

The government has had a subsidy scheme in place since last year that covers 90 percent of the portion of the energy bill where the electricity price was above 70 øre per kWh. The subsidy scheme has been raised from 55 percent and 80 percent of the bill following pressure. 

The PM has ruled out introducing a maximum price, however, a measure which the Conservative Party has also warned against

However, the Oil and Energy ministry confirmed to newspaper VG on Wednesday that the government is working on new measures in response to the energy price crisis.

The objective of the government’s work is to be able to present the main features of the new measures by next week, sources told VG.

The newspaper writes that measures relating to energy production at reservoirs and restriction of exports are being considered while financial support for struggling businesses are also being considered as a way to relieve the pressure of high prices.

Electricity prices have continually hit record levels in the southern part of Norway. The Nordic country is part of the common European energy market and has increased cable capacity for exports, with high quantities of energy exported from Norway to Europe in light of the Russian invasion of Ukraine and subsequent breakdown of Russian gas exports to Europe.

Water reservoirs in southwestern Norway are already low following a low rainfall summer in 2021, with that part of the country particularly suffering in the current climate of high prices.

READ ALSO: Norway’s Prime Minister warns that high energy prices could continue for years

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Could Norway’s gas supplies become a target for saboteurs?

Security experts have warned that Norway's gas supply could become a strategic target for potential saboteurs following unexplained leaks on the Nord Stream pipelines near a Danish Island on Tuesday. 

Could Norway's gas supplies become a target for saboteurs?

Norway’s gas supplies are perhaps the largest and most strategic target for potential saboteurs in Europe, Lieutenant Colonel Geir Hågen Karlsen a defence researcher from the Norwegian military has claimed. 

“We have a major war in Europe right now. Norwegian gas supply is probably the biggest and most strategically important sabotage target in the whole of Europe right now,” he told public broadcaster NRK on Tuesday evening.

His comments come after the two Nord Stream gas pipelines linking Russia, and Europe were hit with unexplained leaks.

The three gas leaks on the Nord Stream 1 and 2 pipelines were visible Tuesday in waters off Denmark, with vast areas of bubbling spreading from 200 to 1,000 metres in diameter, the Danish military said.

“The biggest leak is causing bubbling over a good kilometre in diameter. The smallest is creating a circle about 200 metres” in diameter, the military wrote in a statement accompanying photographs of the leaks off the Danish island of Bornholm.

The EU said Wednesday that leaks from the two Russia-Germany undersea gas pipelines appeared to be “a deliberate act”. 

READ MORE: Pipeline gas leaks in Baltic Sea due to ‘deliberate acts’, says Nordic leaders

The Norwegian government has decided to beef up security at oil installations following the gas leaks. 

“Following the leak, the Norwegian government has decided to put measures in place to increase security at infrastructure sites, land terminals and platforms on the Norwegian continental shelf,” Norwegian Energy Minister Terje Aasland said in a statement late Tuesday.

Equinor has also said it will raise the security level at its installations across Norway. 

Additionally, Norway’s intelligence and security service, PST, said that it was constantly monitoring the threat to Norwegian oil and gas supplies. 

“PST assesses the situation and any threats on an ongoing basis. We advise bodies that need it (security advice),” senior adviser Martin Bernsen from PST told broadcaster TV 2.

Prime Minister Jonas Gahr Store told Norwegian news agency NTB there was “no specific threat against Norway”.

Why could Norway be a target?

Norwegian gas could make a target for saboteurs as, since Russia’s invasion of Ukraine, Norway has become the leading supplier of natural gas to Europe. 

This has made Norwegian gas more critical as Europe looks to Norway to supply its gas needs even more due to supplies from Russia being cut. 

Concerns over gas supplies this winter has led to prices skyrocketing, and instability in the market has also led to much higher energy prices for consumers. 

Prior to Norway becoming Europe’s leading supplier of gas and maintaining full production throughout the summer, a period which is typically used for maintenance, it accounted for around 25 percent of the EU’s and Britain’s gas needs. 

According to the energy ministry, the country will increase its exports by around eight percent this year. Norway should therefore produce approximately 122 billion cubic metres of gas in 2022, according to previous government estimates. That can be compared to the 150 billion cubic metres of gas per year that Russia supplied to the European Union before the war in Ukraine.

Stretching over thousands of kilometres, sometimes at great depths, the oil and gas pipelines are a weak link in the energy supply chain that is so vital to Europe.

These factors are the reason why security experts in Norway have called the country’s pipelines a major target for sabotage. 

“Norwegian gas is undoubtedly the most important target in Europe right now,” Researcher and naval captain at the Naval Academy, Tor Ivar Strømmen, told the Norwegian newspaper VG