Norway Hits Its Highest Electricity Price on Record

The spike in electricity prices, which above all hit the most populated southern part of Norway, has been linked to a combination of weaker than usual reserves coupled with rising costs of gas, coal and carbon dioxide quotas. This trend has been mirrored across Europe, prompting governments to take measures to shield consumers and businesses.

Norwegian households paid an average of 117.2 øre/kWh for electricity in the first quarter of 2022, marking a new price record.

Over the last five years, the average price in the first quarter has been a little over 40 øre/kWh. This year, it climbed almost three times as high.

“This is the highest electricity price we have measured since the measurement started in 1998”, Thomas Aanensen of Statistics Norway warned in a statement.

From very low electricity prices throughout the country in 2020, the prices in southern and more populated part of the country increased sharply through 2021 before reaching the highest level ever on record.

“It is important to remember that these figures show the national average”, Thomas Aanensen stressed. “Recently, there have been large price differences between parts of the country, especially between southern Norway and northern Norway, and therefore it is not certain that everyone recognises themselves that well in the numbers”, he added.

Despite the record prices, households had on average a lower price to pay than in the previous quarter due to electricity subsidies and the reduction of the electricity tax – measures adopted by the government to shield the population from the price hikes.

“When we deduct the electricity subsidy, the total price households had to pay was some 25 percent higher than the average for the first quarter of the last five years”, Thomas Aanensen emphasised.

The electricity support was first introduced in December 2021, and will last until March 2023.

The rise in electricity costs, especially in the southern part of the country, has been pinned on weaker than usual reserves, as well as price hikes on gas, coal and carbon dioxide quotas. In recent months, electricity prices across Europe have skyrocketed, prompting governments from Sweden in the north to Bulgaria in the south to pledge support and relief to both companies, businesses and private households.