For the small soft drink factory Roma in Lillestrøm, the electricity bill has increased by several hundred thousand kroner in the last year. – It is money we as a small local soft drink factory would like to spend on other things, such as investment and development, says Katrine Bergersen Klemp, commercial leader for Rome. Over the past year, the price of electricity in Norway has skyrocketed and varied widely. It has not only frustrated individuals but also businesses. Minister of Finance Trygve Slagsvold Vedum now presents a new tax scheme that applies to companies. It can give them a fixed price for electricity in long-term contracts and thus release the large price fluctuations we have seen so far. – We are very dependent on driving tenancy. It is clear, now we are 102 years old and we value longevity, says Klemp. – Can sell cheaper than today The government is now sending out a proposal for consultation on changes in ground rent tax. It will change the power market and give fixed prices to companies that have struggled with the large fluctuations in the electricity price. news. Minister of Finance Trygve Slagsvold Vedum today visited the soda factory Roma in Lillestrøm. Vedum explains that today, power companies have to put in a large margin on the fixed price due to the tax risk. – What makes fixed-price agreements expensive today is a risk premium, and when it disappears, they can sell cheaper than today, he says. Excerpt from the consultation note: Contract exemption in the ground rent tax linked to fixed-price agreements «The Government shall make better arrangements for an offer of fixed-price agreements to households and businesses through standardized contracts and changes to the ground rent tax. The purpose is to make it easier for end users to achieve more manageable electricity bills and for the power producers to be able to offer large volumes at a fixed price that the electricity suppliers can resell to both households and business customers. ” – We have had a challenging situation with increased electricity prices for the entire Norwegian business community, says Ole Erik Almlid, CEO of NHO. NHO originally wanted a power support scheme for the companies, but Almlid still supports the new scheme. – We are very pleased that we have put in place a good scheme for the business community. I think many will appreciate that a lot, he says. Can suit ordinary people It was Statkraft who came up with the idea, and CEO Christian Rynning-Tønnesen believes that customers and power producers are both on fire with long-term contracts. – We as power producers are taxed by what we actually sell the power for, and this will mean that the offer in the market for long-term contracts will be much better than now and benefit customers, he says. Statkraft’s CEO, Christian Rynning-Tønnesen, says that both customers and power producers are lit with long-term contracts. Photo: Gorm Kallestad / NTB He also believes that the scheme is suitable for ordinary consumers. But it is not uncommon for households to lock themselves into electricity agreements for five, seven or ten years. Here, Rynning-Tønnesen compares it with a fixed interest rate on a home loan. – You can choose to lock in the home loan you have at a fixed interest rate over a number of years. In the same way, one can also choose to lock in the electricity price at a fixed price over several years. Power analysts do not think it provides cheaper electricity – When this proposal came I noticed that it was said that prices would be much lower. I disagree with that, says Tor Reier Lilleholt, head of analysis at Insight by Volue. This is because he does not see the connection between price formation and the fact that one changes the risk in the tax system that producers face. – Yes, it will help the producers to take less risk, but I do not think it will necessarily affect the final power price that is formed every day, says Lilleholt.
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New tax agreement can provide cheaper electricity for this soft drink factory
