Norwegian government unveils energy support for businesses
An energy support scheme, which will see the state pick up part of the electricity bill for some firms, to help Norwegian companies cope with rising power costs, was unveiled by the Norwegian government on Friday.
On Friday, Minister of Trade and Industry, Jan Christian Vestre, unveiled a raft of government measures to help support businesses with rising energy costs in Norway.
"We are today putting forward a package of measures that will come to the aid of the most vulnerable companies this autumn, and contribute in the medium term and create greater predictability and security," Vestre said at a press conference.
The government said around 20,000 businesses in Norway would benefit from the new scheme, which includes the government covering part of the bill when prices rise above a certain level. Around three billion kroner has been set aside to pay for the support package.
Among the measures in the package are direct support, loan guarantees and energy subsidy schemes.
Firms where energy made up more than three percent of total costs during the first half of 2022, will be able to apply for grants that see the government cover up 25 percent of the difference between the current market price and 70 øre per kilowatt hour and as much as 45 percent if they carry out energy saving measures.
Companies that invest in energy-saving measures can also have part of the bill covered by government grants.
Support that will see the government cover part of the bill will only run until the end of 2022. However, the government has said it is open to extending it. More measures may also be announced when the state budget is unveiled in September.
Additionally, the government will submit proposals to parliament to make it easier for businesses to access fixed-price electricity agreements over long periods, which should help stabilise overheads for firms.
As well as the other measures, the government will introduce a new loan guarantee scheme. The scheme will see the state acting as a guarantor for up to 90 percent of the loan for companies that have seen costs soar due to energy prices. The loan guarantee is available until spring 2023.
Companies that receive any support will not be able to pay out dividends in 2023. The government consulted the Confederation of Norwegian Enterprise (NHO) and the Norwegian Confederation of Trade Unions (LO) when formulating the scheme.
Norway's Conservative Party has criticised the new scheme because subsidised bills could end as early as the new year.
"It is too early to end the scheme already at New Year's. We are unsure whether the government has really understood the seriousness of the situation," Nikolai Astrup, the Conservative Party's energy spokesperson, said.
Meanwhile, the NHO said that it wanted the scheme to do more to help cover the rising costs of larger businesses which will be overlooked for subsidised energy bills as support is capped at 3.5 million kroner.