“The European energy market is greatly influenced by the war in Ukraine, which has led to significantly higher prices of energy. The energy cost for American companies is about a third of the energy cost for European companies,” said Øystein Dørum.
He is the Chief Economist at the Confederation of Norwegian Entreprise (NHO) – Norway’s largest organization for employers.
At Sørlandets Energy Conference in Kristiansand, Dørum provided an analysis of the situation and concluded that energy markets have contributed to a downturn in the European industry sector.
He went on to discuss a new energy market reality which consists of more volatile energy sources – and prices. Volatility has already resulted in several hours with extreme price levels of electricity, especially in price area NO2 – which covers Kristiansand and the Agder region.
“Unfortunately, if you have a factory in this region, you will stand at a disadvantage compared to a similar factory in another price area. The price of energy alters the playing field and contributes to an unfair fight – which no-one welcomes,” said Dørum.
Kristin Dale, Head of Industry Development at utility Å Energi, argued for the need for more energy production, in a time where renewable energy is facing increased skepticism on the political scene.
“Renewable energy is still the solution,” she said. “Trump can’t make the climate challenges go away or fire everybody that work for a greener tomorrow.”
Turning to Norway, Dale expressed concerns for the energy sector.
“Two years ago, the Norwegian Energy Commission called for “more of everything, faster”. Since then, we have had “less of everything, slower”. Norway implemented only 415 GWh last year, the lowest in more than a decade, in a time when we need it the most,” says Dale.
Dørum also commented on the domestic situation saying: “Norway subsidizes energy production, energy consumption, and energy efficiency measures. Is this sustainable?”
