Statnett’s record revenues from interconnectors to reduce grid tariffs

Statnett has reported record revenue of nearly NOK 3 billion (around $331.8 million) so far from interconnectors to other countries which will be passed on to Norwegian consumers through a reduction in grid tariffs.

In addition to the revenues from the interconnectors, congestion revenues from the Norwegian internal transmission grid are roughly NOK 1 billion (around $114.4 million) so far this year, which brings the total congestion revenues up to almost NOK 4 billion (nearly $458 million).

“These revenues contribute to financing the significant investments we are making to ensure enough electricity for the green transition. They also benefit Norwegian consumers, as our share of the grid tariffs will be lower than it was in 2020, in the middle of a period of massive development of the transmission grid nationally and internationally”, said Hilde Tonne, Statnett’s CEO.

It is expected that the total congestion revenues in 2021 will cover over 40% of the costs for the transmission grid Statnett is responsible for.

The operator believes that the record high congestion revenues are a consequence of the large price differences between Norway and neighbouring countries with higher electricity prices.

“It is good to see the large revenues from our interconnectors and that the subsea cables we have built to Germany and the UK so far show profitability. These revenues are important when we are to invest NOK 60-100 billion in the grid to support the green change of pace”, added Tonne.

To remind, in the past year Statnett completed two subsea interconnectors, NordLink to Germany and North Sea Link to England.

As explained, the income from these subsea interconnectors comes regardless of which way the electricity flows. So far, 15% of the congestion revenues came when Norway was importing electricity from Germany during periods of high power production and low prices on the German side.

Overall, the revenues exceeded costs and the profit resulted in a reduction in grid rent of NOK 0.005-0,01 / kWh in the last two years, Statnett concluded.