"Norway Price" to Ensure Predictable and Stable Electricity Prices for Consumers

The government proposes introducing an alternative support scheme for electricity for households, called the “Norway Price.” Under the Norway Price support scheme  will be offered a fixed price on electricity at 40 øre per kWh (excluding VAT). The proposal for the design of the Norway Price is sent for public consultation. The goal is for the support scheme to take effect from October 1 this year.

'The purpose of introducing the Norway Price is to provide security and predictability for people's electricity expenses. Today, the proposal for the Norway Price is being sent for consultation, bringing us one step closer to implementation. The Norway price is optional, and those who do not choose it will still be covered by the existing electricity subsidy scheme,' says Minister of Energy Terje Aasland.

The Norway price support scheme will apply to residential homes and holiday homes. It will be an optional alternative for those who prefer a fixed price throughout the year rather than a standard electricity contract with an electricity subsidy.

Annual Adjustment of the Norway Price

The government proposes that the level of the Norway Price be adjusted once a year, with the price applying from January 1 to December 31. The 40 øre rate will be valid from October 1, 2025, to December 31, 2026, with the first price adjustment taking place from January 1, 2027. The adjustment will be based on future electricity price trends but will also ensure that the scheme continues to provide predictable and stable electricity prices, reflecting historical electricity price developments.

Consumption Cap

To encourage electricity savings and energy efficiency among high-consumption households, the government plans to introduce a consumption cap for the Norway Price. The consultation seeks input on whether the cap should be set at 3 000, 4 000, or 5 000 kWh per month for residential homes and 500, 1 000, or 1 500 kWh per month for holiday homes.

The current electricity subsidy scheme has a consumption cap of 5 000 kWh per month, and the consultation also seeks feedback on whether this should be lowered to either 3 000 or 4 000 kWh per month or remain at the current 5000 kWh per month.

Contract Duration

The Norway Price contract runs from January 1 to December 31 each year. Customers can sign up for the scheme at any time during the year, and their contract will be valid until December 31 of the same year. Contracts signed between October and December 2025 will remain valid until December 31, 2026.

District Heating Considerations

Approximately 300,000 households in Norway use district heating for heating purposes. The government aims to ensure that these households are treated equally to those using electricity and will propose a scheme for district heating customers to achieve this. The scheme will be designed such that it will not negatively impact district heating companies. The government will present the design of a scheme for district heating customers it in a separate consultation.

Additionally, the government will soon implement changes to the energy labelling system for housing and buildings. These changes will equalize district heating with efficient electric-based heating solutions, such as heat pumps. This will ensure that buildings using district heating can achieve an A energy rating without requiring major additional investments.

Administration of the Scheme

The government plans for the Norway Price scheme to be administered by the grid companies, and that customers sign a contract for the Norway Price directly with their respective grid company.

Duration of the Scheme

The government proposes that the Norway Price, the current electricity subsidy scheme, and the electricity subsidy scheme for will remain in effect until December 31, 2029. The schemes will then be evaluated, and a potential extension will be considered based on the situation in the electricity market, the schemes’ effectiveness, and future needs.

The consultation period ends on April 21, 2025.

Background on Consumption Cap

• 4% of Norwegian households consumed more than 5 000 kWh in one or more months in 2024.
• 8.6% of Norwegian households consumed more than 4 000 kWh in one or more months in 2024.
• 20.9% of Norwegian households consumed more than 3 000 kWh in one or more months in 2024.
• 24.3% of Norwegian holiday homes consumed more than 1 500 kWh in one or more months in 2024.
• 49% of Norwegian holiday homes consumed more than 1 000 kWh in one or more months in 2024.
• 77.6% of Norwegian holiday homes consumed more than 500 kWh in one or more months in 2024.

The Norway Price is a state-funded support scheme, ensuring that customers pay 40 øre per kWh (excluding VAT) as a fixed electricity price. . Additional costs for electricity supply include grid tariffs, taxes, and surcharges associated with the electricity supplier contract. Taxes include the electricity tax, contributions to the energy fund, and VAT. These charges apply nationwide, with some exceptions. Surcharges in the agreement with the electricity supplier will vary depending on the specific electricity contract.