{"id":80911,"date":"2024-03-11T10:22:05","date_gmt":"2024-03-11T10:22:05","guid":{"rendered":"https:\/\/teknomers.com\/en\/municipalities-lose-money-on-upgrading-power-plants-news-vestland\/"},"modified":"2024-03-11T10:22:06","modified_gmt":"2024-03-11T10:22:06","slug":"municipalities-lose-money-on-upgrading-power-plants-news-vestland","status":"publish","type":"post","link":"https:\/\/teknomers.com\/en\/municipalities-lose-money-on-upgrading-power-plants-news-vestland\/","title":{"rendered":"Municipalities lose money on upgrading power plants – news Vestland"},"content":{"rendered":"\n

From Folgefonna, the water rushes into the Mauranger hydropower plant by the Hardangerfjord. When production started in 1974, the power plant was the first in the country to extract meltwater from under a glacier. 50 years later, time has passed from the power plant in Kvinnherad, and the owner (Statkraft) wants to refurbish it. But not without resistance. – This development alone could mean NOK 2 million in reduced income, says Vegard Bj\u00f8rnevik (H), who is mayor in the municipality. The explanation is new tax rules that will encourage Statkraft and other Norwegian power companies to upgrade old hydropower plants. The problem is that the same rules go beyond the income of the host municipalities, which exchange their “guest freedom” for licensing power and tax revenue. Therefore, the host municipalities lose out on power development In 2021, the basic interest tax for hydropower was changed to a cash flow tax with direct deductions for investments in the investment year. For investments in effect development, the ground rent tax is therefore low in the year of investment, and high in the following years. Due to the cap on the property tax base for power plants (NOK 2.74\/kwh), host municipalities will not “benefit” from low ground rent tax in the investment year, but will be penalized twice in the remaining years. Partly because the basic interest tax that goes to deduction becomes high in the years after the investment year; and partly because power plants can deduct from the present value of future replacement costs. In sum, this means that host municipalities receive less tax revenue by saying yes to impact development. In addition to being “hosts”, many municipalities are on the owner’s side and can exert an influence on the management of the power producers through their shareholding. This is how upcoming general meetings can become an arena for steep fronts: On one side of the table: Municipal representatives who have a financial interest in slowing down new investments that can be deducted from property tax. On the other side: Representatives of “the official view” that Norway needs more balancing power. And in the middle: Those who have two hats and can see the matter from both sides. Dravladalen. From the development of the Folgefonn facilities in 1973. Photo: NVE. The sediment chamber under Bondhusbreen. Facsimile from Statkraftverkene’s information brochure, 1980. “Windauget” is a construction barrack that clings to the mountainside below Bondhusbreen. The workers had their living and dining quarters here during the Mauranger development in the 70s. Photo: UiO. – A paradox that there is no will to adapt the regulations. Leader of the National Association of Hydropower Municipalities (LVK), Jon Rolf N\u00e6ss, believes that the state must take action so that the host municipalities and the power companies have overlapping interests: – The state must address this and create arrangements that captures tomorrow’s hydropower production, he says. Statkraft announced earlier this year that they will spend up to NOK 35 billion on upgrading old hydropower plants “to make the power system more robust”. – Upgrading hydropower is part of our growth strategy, says CEO Christian Rynning-T\u00f8nnesen of Statkraft. Photo: Gorm Kallestad \/ NTB Selling your butter without getting paid is a metaphor for being cheated. The mayor of Sirdal municipality, Jonny Liland (Ap), says it is “a fact” that the municipalities are still left as neglected butter producers when old hydropower plants are upgraded. – When there is broad agreement that we need extensive restructuring, it is a paradox that there is no will to adapt the regulations to tomorrow’s power development, he says. Hafslund Per Storm-Mathisen, Hafslund \u2013 It is a paradox that incentives pull in different directions. Although the host municipalities are initially positive about upgrades and power expansions, they will naturally become less positive if they lose income from such projects. Jonny Liland, Sirdal mayor – The renewable development that will be absolutely decisive in achieving our climate goals will mainly be upgrades of existing hydropower plants with expansion of output, in addition to land-based wind power. There are various ways in which the obvious shortcomings of the current framework can be addressed. Svein Sundsdal Jon Rolf N\u00e6ss, leader of the National Association of Hydropower Municipalities – The state must address this and create joint national arrangements that capture tomorrow’s hydropower production, so that some of that value creation is also created locally – where the production takes place. news Leif Lia, NTNU \u2013 This paradox must be unraveled before it comes to individual cases and creates hard fronts. One solution could be to link the income of counties and municipalities more closely to the cash flow from power plants, and tax experts can certainly find good solutions for this. Norsk Gr\u00f8nnkraft Rune Skjevdal, head of Norsk Gr\u00f8nnkraft \u2013 First and foremost, the nation needs energy and power. The first order is therefore that the project becomes profitable to invest in for initiative holders. Compared to the others, the power municipalities have a relatively good income base from power. news is aware that Fornybar Noreg has started work to find a way for the incentives to play together. – We work every day to ensure that the regulations have as sufficient incentive as possible for both municipalities and power companies to contribute to the energy transition, says \u00d8istein Schmidt Galaaen, who is director of production and renewable energy at Fornybar Noreg. He adds: – We will not get through the energy transition without local goodwill. – Vasskraft has the highest priority, said State Secretary in the Ministry of Energy, Elisabeth S\u00e6ther, when she addressed the Production Technology Conference (PTK) in Gardermoen this week. She added: – So get started and build, we need you! Photo: Even Bj\u00f8rings\u00f8y Johnsen – It is important that the tax rules promote socially profitable developments During a power conference in Gardermoen this week, there was broad agreement that the quantity of hydropower must no longer be the main focus, but the quality of hydropower as a balancing force. Among the participants at the conference was NTNU professor Leif Lia. He believes that the current tax rules can become “an effective stopgap” for rebuilding and modernizing the hydropower system. – The politicians must urgently address this paradox. I am sure that tax experts can find good solutions for this. Attande in Kvinnherad, mayor Vegard Bj\u00f8rnevik says that “the solution is actually simple”: New tax rules that promote – and not inhibit – the green shift. – If not, I’m afraid the host municipalities will say no to further developments. Mayor of Sirdal municipality, Jonny Liland (Ap), says it is “a fact” that the old arrangements which have historically benefited the host municipalities with large revenues do not work as well for the new generation of hydropower plants. Photo: Right
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From Folgefonna, the water rushes into the Mauranger hydropower plant by the Hardangerfjord. When production started in 1974, the power plant was the first in the country to extract meltwater from under a glacier. 50 years later, time has passed from the power plant in Kvinnherad, and the owner (Statkraft) wants to refurbish it. But […]<\/p>\n","protected":false},"author":1,"featured_media":80912,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[439,1371,231,16,530,615,14621,40],"class_list":["post-80911","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-lose","tag-money","tag-municipalities","tag-news","tag-plants","tag-power","tag-upgrading","tag-vestland"],"_links":{"self":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/posts\/80911","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/comments?post=80911"}],"version-history":[{"count":0,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/posts\/80911\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/media\/80912"}],"wp:attachment":[{"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/media?parent=80911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/categories?post=80911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/teknomers.com\/en\/wp-json\/wp\/v2\/tags?post=80911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}