Norway to help ease the power price pain for businesses

Oslo:norway’s government on Friday presented a long-awaited package of loans and subsidies to reduce the impact of sky-high power prices for businesses, joining other European countries seeking to ease the energy crunch.

Governments across the region have been racing to present measures to protect consumers and industry from more expensive energy bills.

The subsidy scheme will cover companies with power costs exceeding 3 per cent of revenue in the firsthalfof2022,costingatotalof3billionnorwegian crowns($292.5million),industryministerjanchristian Vestre told a news conference.

“On the one hand, we must avoid creating further pressure on the Norwegian economy, while at the same time we want to give electricity-intensive companies help to adapt,” Vestre said.

Norway’s NHO business lobby, which took part in negotiationsonthemeasures,saiditbackedtheplan.

The subsidy presented by the centre-let government will compensate 25 per cent of power rates above a threshold of 0.70 Norwegian crowns per kilowat hour and will be capped at 3.5 million crowns per company. In addition, companies can borrow up to 50 million crowns, he said.

The scheme is intended to last until the end of the year, with the government planning tax changes from January to simplify and provide incentives for fixed-price, long-term power supply deals at less than current elevated levels.

Wholesale power prices in southern parts of Norway have soared by 700 per cent over the past year from 0.50 crowns/kwh to 4 crowns/kwh owing to a combination of high European gas prices and a dry year in the hydropower-dependent country.