We cannot expect the cost of electricity production to be more than the current wholesale selling price of electricity. Thus, it needs to be four cents per kWh or less. Ideally, the price of electricity should be falling, as in Slide 6.Oil price is currently $36.10. This mean Norway earns NOTHING on its oil production. The only hope we have left to keep our famous welfare state is to protect our low electricity prices from renewables, of which 97% is from hydro. For the moment the price for industry is about two cents per KWh, or about the half of what Tverberg recommends.
Another consideration is that we need to be able to operate our current vehicles using a liquid fuel, made with electricity, because of the time and materials involved in switching over to electric vehicles. This requirement likely reduces the maximum cost of electricity even below four cents per kWh. - Gail Tverberg
The combination of low renewable electricity prices, a weakening N.Kr. + a lot of engineers losing their jobs in oil- and oil related industries, makes Norway very attractive for international industry. Recently a factory making parts for Volvo moved its production from China to Norway.
In this situation Norway is about to construct several power transmission lines for electricity to England and the European continent. This is absurd, like suicide. This will raise electricity prices in Norway to continental levels, and we'll lose our last advantage. This means the end of the Norwegian welfare state!
This destruction of our welfare state, our children's schools and their future, cannot be tolerated. All construction of power transmission grids for abroad must be stopped, and all existing export grids must be cut off!
I highly recommend to read the whole post of Gail Tverberg, a Norwegian-American from Voss, to get the whole picture!
- We are at Peak Oil now; we need very low-cost energy to fix it
A response from Gail Tverberg
Industry goes where industrial energy prices are cheapest. I know that Norway has been charging residential users high prices–perhaps because people have such high salaries in Norway. But if they can charge industrial users less than two cents per kWh, then that becomes the “price to beat.” No industry is going to move to a country with 20 cent per hour electricity, if electricity is available for less than 2 cents an hour elsewhere. - Gail Tverberg