Bloomberg News

Proposed EU Rules May Thwart New Norway-Europe Power Cables

December 10, 2012

The European Union’s plans to raise contributions to its infrastructure fund may deter Norway from building electricity cables linking the Nordic country with the continent, the nation’s power-industry association said.

The European Agency for the Cooperation of Energy Regulators has suggested the bloc’s fund should be boosted by as much as 16-fold so that transmission system operators would receive more compensation for costs of hosting cross-border flows on their networks.

“This would weaken Norway’s incentives for building new power cables,” Hans Olav Ween, adviser at power industry lobby group Energy Norway, said today by e-mail from Oslo.

The EU needs new international links so that countries with excess solar and wind production can ship their surpluses to countries where demand is high. Norway, which now contributes 70 million kroner ($12 million) annually to the EU’s fund, is considering cross-border power projects that would help export power surpluses that the country is unable to absorb.

State grid company Statnett SF may build a 1,400-megawatt undersea cable from Germany to Norway by 2018 and a 1,400- megawatt link to the U.K. by 2020. Both would enable Norway to export hydropower output and allow Germany and the U.K. to offset intermittent production from wind and solar power. NorthConnect, a partnership of Swedish, British and Norwegian companies, plans a 1,400-megawatt cable to the U.K. by 2020.

No investment decisions on the cables have yet been taken. The EU’s Agency for the Cooperation of Energy Regulators, known as ACER, may present its recommendations for legislative action to the EU Commission by March.

To contact the reporter on this story: Torsten Fagerholm in Helsinki at tfagerholm@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net


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