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It also has a lot to do with not enough transmission capacity to get the electricity from north to south. At this very moment the spot price in north most prici

by doikor 4y ago

It also has a lot to do with not enough transmission capacity to get the electricity from north to south. At this very moment the spot price in north most pricing region Tromso is a lot cheaper than in Oslo region (~1/10th). Sweden has the same problem. If I was from Norway or Sweden I would demand the national grid to massively invest into the transmission lines to make all the electricity produced in the country actually usable anywhere in the country. Basically work to get rid of these pricing regions within the country. This is how the network here in Finland works Also why they are now talking about adding new lines from south of Finland to Sweden (also mentioned in the article) so the electricity produced in north Sweden can be sold to south Sweden through Finland as the national grid of Sweden just can't get it done. edit: You can go to https://www.nordpoolgroup.com/en/Market-data1/Dayahead/Area-Prices/ALL1/Hourly/?view=table https://www.nordpoolgroup.com/en/Market-data1/Dayahead/Area-... to check the day ahead prices in different price regions.

yesseri 4y ago
There has been massive investments into transmission capacity in Sweden. The capacity has not increased that much though. One of the reasons are that nuclear power plants have been closed. Large turbines contributes to an increased transmission capacity. All the big investments have been necessary just to ensure that the capacity doesn't get lowered due to the closing of the nuclear plants.
syoc 4y ago
I do not think that effective transfer of energy from the north to the south would matter much. The price in the energy market is set by the actor willing to pay the most at any given moment. If energy from the north was enough to influence the German or British prices then maybe, otherwise it wouldn't really matter.
londons_explore 4y ago
Transmission capacity is a classic example of a neat economics problem. If there was a benevolent dictator making ideal decisions, they would build enough transmission capacity to minimize generation+transmission costs while still serving all users in the country. However, if there is a private company building a transmission line, they have an incentive to under-build capacity to maximize their profits - since if they overbuild, then the price in all the regions is identical, and their profits by transporting energy are nil. Yet, due to the nature of transmission lines, it doesn't make sense for 50 companies to build 50 independent transmission lines on the same route to compete on transmission pricing - the total cost of fifty 1 megawatt lines is far higher than one 50 megawatt line. It's a good example of an economics problem where the free/restricted market doesn't work anywhere near as well as the benevolent dictator model. There are lots of similar problems - for example shipping goods from a place where they are less valuable to a place they are more valuable.
Tor3 4y ago
"If I was from Norway or Sweden I would demand the national grid to massively invest into the transmission lines to make all the electricity produced in the country actually usable anywhere in the country. " That would be fine if it was only about prices in the country. But due to the way the EU agreement works, higher capacity transmission lines only means that more electricity will be exported and more of those countries would suffer. Norway currently exports more than the surplus. With higher internal transmission capacity Norway would export even more. Which will have to be imported from EU comes winter, at prices which have already closed a LOT of businesses in Norway.
- doikor 4y ago
  > higher capacity transmission lines only means that more electricity will be exported and more of those countries would suffer. Build better transmission within the country but not between countries. The transmission lines between countries is how you limit how much electricity you can trade with other countries.

by doikor 4y ago

yesseri 4y ago

There has been massive investments into transmission capacity in Sweden. The capacity has not increased that much though. One of the reasons are that nuclear power plants have been closed. Large turbines contributes to an increased transmission capacity. All the big investments have been necessary just to ensure that the capacity doesn't get lowered due to the closing of the nuclear plants.

syoc 4y ago

I do not think that effective transfer of energy from the north to the south would matter much. The price in the energy market is set by the actor willing to pay the most at any given moment. If energy from the north was enough to influence the German or British prices then maybe, otherwise it wouldn't really matter.

londons_explore 4y ago

Transmission capacity is a classic example of a neat economics problem. If there was a benevolent dictator making ideal decisions, they would build enough transmission capacity to minimize generation+transmission costs while still serving all users in the country. However, if there is a private company building a transmission line, they have an incentive to under-build capacity to maximize their profits - since if they overbuild, then the price in all the regions is identical, and their profits by transporting energy are nil. Yet, due to the nature of transmission lines, it doesn't make sense for 50 companies to build 50 independent transmission lines on the same route to compete on transmission pricing - the total cost of fifty 1 megawatt lines is far higher than one 50 megawatt line. It's a good example of an economics problem where the free/restricted market doesn't work anywhere near as well as the benevolent dictator model. There are lots of similar problems - for example shipping goods from a place where they are less valuable to a place they are more valuable.

Tor3 4y ago

"If I was from Norway or Sweden I would demand the national grid to massively invest into the transmission lines to make all the electricity produced in the country actually usable anywhere in the country. " That would be fine if it was only about prices in the country. But due to the way the EU agreement works, higher capacity transmission lines only means that more electricity will be exported and more of those countries would suffer. Norway currently exports more than the surplus. With higher internal transmission capacity Norway would export even more. Which will have to be imported from EU comes winter, at prices which have already closed a LOT of businesses in Norway.

doikor 4y ago
> higher capacity transmission lines only means that more electricity will be exported and more of those countries would suffer. Build better transmission within the country but not between countries. The transmission lines between countries is how you limit how much electricity you can trade with other countries.