Visitors to Norway may be surprised at the liberal use of electricity in the country. It is normal to see lights left on until morning in empty offices or in the entrances of houses and private garages.
During my first visit in 1994, I saw lights in front of some houses left on during daytime and when I asked why, I was told that Norway generates electricity from hydropower and it is cheap to produce, so no one bothers to save energy. Perhaps, electricity rates are the only cheap item here as prices of other things are among the highest in the world.
This may be so even today as Norway relies predominantly on tapping rainfall in reservoirs for electricity generation. In 1950, hydropower generation in Norway was about 3,000 MW and now, it is close to 30,000 MW from 1,166 stations — small and big.
In 2011, total electricity generation was close to 128 terawatt hours (TWh) and 95.2 per cent of this was sourced from hydropower. The rest was derived from renewable sources of thermal power, from burning waste and utilising wind power. Consumption on the other hand was close to 114 TWh, with the majority used in industry, mining, transportation and construction, with only 38 TWh used for private consumption.
Therefore, Norway’s net export of electricity in 2011 was close to 14 TWh. More was expected to be realised during 2012 due to increased rainfall.
Battery of Europe
Perhaps, gross exports could be higher because Norway imports electricity from other countries at night when rates are less and exports the same at daytime when the rates are higher. Hence the tag, the “battery of Europe”.
Norway is able to do that because generation from its hydropower plants is easily adjustable and can adapt well to variations in load and price. The country is benefiting from using pumped storage to its advantage in this regard. The fact that Norway’s network is integrated with Sweden, Denmark, Germany and the Netherlands makes export and import commonplace as and when the situation demands.
The potential could double Norway’s hydropower generation which will help it to increase its exports significantly and supply domestic demand for the foreseeable future. However, new power cables and connections to other countries are needed to facilitate such expansion and plans are already confirmed for the construction of a sub-sea electric power cable to the UK and Germany, which could come at the end of this decade. The UK link could generate as much as 1,400 MW.
The average price of electricity for households in Norway was the cheapest in Europe in 2011 at 84.2 ore/kWh or $0.1514/kWh as compared to Germany at $0.199 or to Denmark’s $0.246. Prices in winter could be much more due to the higher consumption for heating. Needless to say, prices in the UAE are lower though the generation is from oil and gas resources.
Because of the government’s encouragement to use the abundant electrical energy, per capita consumption in Norway is about 26- to 27-MWh as compared to that of the EU’s 7.4-MWh. Norway is encouraging the use of electric cars by offering public subsidies worth as much as $8,200 (Dh30,116) per car per year. This is excluding the advantage of driving in bus lanes for speedier transit. But at 10,000 units a year, sales of electric cars are far below expectations due to the reluctance of long-distance drivers brought on by frequent recharging the current models need.
Criticism of electric cars
At the same time, studies by the Norwegian University of Science and Technology are questioning the environmental advantage as far as climate change is concerned. The study concludes that the “global warming potential” of the process used to make electric cars is twice that of conventional cars.
It also highlights the “toxicity” of the electric car’s manufacturing process. And finally it also gives advice to the rest of the world by saying: “It is counterproductive to promote electric vehicles in regions where electricity is produced from oil, coal and lignite combustion.”
Yet, Norway is considering the launch of the world’s first electric ferry by 2015 which will carry 360 passengers and 120 cars running on batteries that “take just 10 minutes to recharge between trips.” Without the current hydropower and its future potential, government policy may have been different.
Municipal waste burning is another source of electricity and heat in Norway. But shortage of waste due to organised recycling is forcing Norway to import household trash and other sources of waste from other countries to keep its plants supplied.
Our region may be short of water resources, but there is a lot to be learnt from Norway’s experience.
— The writer is former head of the Energy Studies Department in the Opec Secretariat in Vienna.