CPI up 6.7 per cent last 12 months

The Norwegian parliament has adopted a support scheme for electricity costs aimed at households. When the market price of elspot on average exceeds NOK 0.7 per kilowatt hour for one month, the state will provide direct support to electricity customers, with a support share of 55 percent in December 2021 and 80 percent as of January through August 2022. From September 2022 the support share was increased to 90 percent. The support is provided for a monthly power consumption of up to 5000 kilowatt hours.

The CPI measures the support scheme for electricity costs as a direct discount on electricity prices aimed at households. The CPI takes the five bidding areas into account when calculating the electricity index. For the bidding area where the elspot prices on average for the month do not exceed NOK 0.7 per kilowatt hour (excl. VAT), the actual market prices paid by households are used. While compensated prices are used for elspot in bidding areas where the average elspot price for the month does exceed NOK 0.7 per kilowatt hour.

The discount is applied to all contract types for electricity that are included in the CPI for the given bidding area. The value added tax (VAT) is added to the price in bidding areas that are not exempt from this. The calculations include an estimate of how much of the consumption takes place in cabins and is therefore not covered by the support scheme.

January to March, a reduced general electricity tax on grid rent has been adopted. From April and until the end of the year, the general tax level applies. Both tax levels increase compared to corresponding periods in 2022. The electricity tax is included in the CPI in the calculation of the index for grid rent.