How Norway's energy support scheme is changing from September
Changes will be made to Norway's energy subsidy scheme, which aims to give more support to eligible households and make it easier to calculate bills.
From Friday, September 1st, a new energy support scheme will be in place. The Norwegian government will still pay 90 percent of the excess when the price rises above 70 øre per kilowatt hour.
However, the scheme will change so that support will be applied on an hourly basis rather than a monthly average.
This means that many will receive more support when prices peak rather than receiving support based on the monthly average.
In that sense, households will be better protected against extreme fluctuations in price. However, analysts say that those who adjust their habits to use more energy when prices are lower will lose out.
"The change was sold by the government as a major improvement, but our own calculations show that the change has a marginal impact on people's electricity bills," Linda Ørstavik Öberg, energy policy adviser at the consumer organisation the Homeowners, told Norwegian newspaper VG.
Consultant and social economist at Vista Analysis, Andreas Hoel-Holt Stranden, said that the new support scheme could lead to people becoming more wasteful.
"The reason why the price of electricity is sometimes very high is that there is a shortage of electricity. The high prices can cause people to change their habits or invest in technical solutions that shift electricity consumption to other times of the day. But when the state covers most of the price spikes, we may want to continue using electricity when there is actually too little of it," he told VG.
While the scheme first enters effect in September, it will not be noticeable until October's bill. The bill you receive in September will be based on the old support scheme.
Marius Holm Rennesund, partner at the Norwegian energy consultancy, Thema recently told The Local that energy prices between 65 and 90 øre per kilowatt hour could be expected in southern Norway this autumn and winter.
READ MORE: Will power prices in Norway be as high this winter as they were last year?
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From Friday, September 1st, a new energy support scheme will be in place. The Norwegian government will still pay 90 percent of the excess when the price rises above 70 øre per kilowatt hour.
However, the scheme will change so that support will be applied on an hourly basis rather than a monthly average.
This means that many will receive more support when prices peak rather than receiving support based on the monthly average.
In that sense, households will be better protected against extreme fluctuations in price. However, analysts say that those who adjust their habits to use more energy when prices are lower will lose out.
"The change was sold by the government as a major improvement, but our own calculations show that the change has a marginal impact on people's electricity bills," Linda Ørstavik Öberg, energy policy adviser at the consumer organisation the Homeowners, told Norwegian newspaper VG.
Consultant and social economist at Vista Analysis, Andreas Hoel-Holt Stranden, said that the new support scheme could lead to people becoming more wasteful.
"The reason why the price of electricity is sometimes very high is that there is a shortage of electricity. The high prices can cause people to change their habits or invest in technical solutions that shift electricity consumption to other times of the day. But when the state covers most of the price spikes, we may want to continue using electricity when there is actually too little of it," he told VG.
While the scheme first enters effect in September, it will not be noticeable until October's bill. The bill you receive in September will be based on the old support scheme.
Marius Holm Rennesund, partner at the Norwegian energy consultancy, Thema recently told The Local that energy prices between 65 and 90 øre per kilowatt hour could be expected in southern Norway this autumn and winter.
READ MORE: Will power prices in Norway be as high this winter as they were last year?
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