The electricity price increased substantially both in 2021 and 2022. In the third quarter household experienced yet another price record, according to new figures from the electricity price statistics.
The price of electricity for households including grid rent and taxes, but before electricity support is deducted, was on average a record high 317,6 øre per kWh in the third quarter of 2022. The price of electricity amounted to 214,3 øre per kWh of the price, while grid rent and taxes amounted to 29,5 and 73,8 øre/kWh respectively.
The electricity support for households from the government totaled a record high 176,1 øre/kWh on average in third quarter, 68 øre/kWh higher than the previous quarter. The total price household paid for electricity (including grid rent and taxes) and after electricity support is deducted from the bill, was 141,5 øre/kWh. This is 3,1 per cent higher compared to the second quarter this year, but still well below the record high total price of 164,8 øre per kwh in the fourth quarter of 2021.
– When electricity support is deducted from the total price for households, the price in third quarter is still about 30 per cent higher compared to the average price in third quarter the last five years, says senior advisor Thomas Aanensen.
The electricity support for households was introduced by the government in December 2021. It provides a deduction on household electricity bills at times when the average market rate for electricity exceeds 70 øre per kilowatt hour for one month. Since the electricity price for households in the southern part of Norway was very high in the third quarter, the electricity support paid to households also was high.
More price records
The average price of electricity for households, excluding taxes and grid rent, also was record high in the third quarter. This price was on average 214,3 øre/kWh in the third quarter, 90 øre/kWh higher than last quarter and almost 100 øre/kWh higher than the first quarter of 2022.
– The average price of electricity for households, excluding taxes and grid rent, in third quarter, for the last five years, was about 44 øre/kWh. This year the price in third quarter was almost five times as high. This is the highest price recorded since the quarterly price statistics started in 1998, says Thomas Aanensen.
– It is important to remember that the electricity price presented is an average for the whole country. For some time now there has been a large price difference between the Northern and Southern part of Norway.
The record high electricity prices in the Southern part of Norway in the third quarter is closely related to the very high electricity prices in Europe caused by the energy crisis and very high prices on gas and coal. Also, there was record low filling level in the water reservoirs in the south of Norway for most of the quarter.
Spot price contracts most expensive in third quarter
Households with The Elspot price is derived from the Nordic power exchange (Nord Pool AS) from the participants’ combined demand and supply for electricity the next day. The price and volume are determined for each hour of the day. The Elspot price can vary between the different Elspot bidding areas depending on market conditions. Norway is normally divided into five Elspot areas (NO1-NO5). contracts paid the highest price in the third quarter of 2022 with an average electricity price of 225.3 øre per kWh, excluding taxes and grid rent. Spot price contracts are the most common contract type for households (see figure 3)
The price of variable price contracts was on average 69.7 øre per kWh in the third quarter.
The price for different types of fixed price contracts for households:
- New fixed-price contracts, lasting 1 year or less: 91,6 øre/kWh
- New fixed-price contracts, lasting more than one year: 55,0 øre/kWh
- Older fixed price contracts: 58,4 øre/kWh
Many electricity suppliers have currently stopped offering new fixed price contracts because of the great uncertainty on the future price of electricity. The price on the fixed price contracts still available to households depends on the spot price area that the households belong to. There price difference for fixed price contracts between the Northern and Southern part of Norway is large.