Trondheim and Steinkjer, 15.03.2016 EFTA Surveillance Authority Rue Belliard 35 B- 1040 Brussels Belgium [email protected] Complaint: Norway gives about NOK 4 billion as an extra support to wind power projects in Trøndelag. We claim that this support violates the general EU market rules. A wind Power consortium consisting of Statkraft, Trønderenergi and Nordic Wind Power is planning 6 wind power sites in Trøndelag (Mid Norway), with a total of 1000 MW installed effect and a yearly production of 3.4 TWh. These wind power sites are going to receive a public support of about NOK 0.15/ kWh for 15 years as an addition to the electricity market price, a support given to all new renewable power installations in Norway and Sweden to be put to work within 2021. We accept that this support probably is within EU market rules. Our complaint concerns an extra support of about NOK 4 billion, which is to be given to the consor- tium through a free connection to the national power grid through new 420 kV overhead lines. The general rule in Norway is that connections of new power plants to the national grid are to be paid by the owner, but in this case the connection is to be paid by Statnett, the owner of the national grid. We claim that this extra support of NOK 4 billion violates the EU market rules of fair competition. Complainants Naturvernforbundet i Sør Trøndelag Sandgata 20 7012 Trondheim Norway Regional departments of: e-mail: [email protected] phone: +47 40248084 Naturvernforbundet (Friends of the Earth Norway) Naturvernforbundet i Nord Trøndelag Norwegian environmentalist organisation Sandgata 20 7012 Trondheim http://naturvernforbundet.no/?lang=en_GB Norway e-mail: [email protected] phone: +47 40248084 ____________________________________________________________________________________________________ Address: Sandgata 20, 7012 Trondheim, Norway – Phone: ++47 40248084 E-mail: [email protected] – Internet: www.naturvernforbundet.no/trondelag Confidentiality We authorise the EFTA Surveillance Authority to disclose our identity in its contacts with the authorities of Norway. Detailed complaint Is the planned 420 kV overhead power line; Namsos – Storheia – Snillfjord – Trollheim; necessary to strengthen the national power grid, or represents this power line nothing else than connections to the national power grid from the four wind power sites in Fosen, and the two wind power sites in Snillfjord and Hitra? If the planned power line only represents a ordinary connection to the national power grid, then the wind power companies should pay for the connection. If the planned power line represents a necessary strengthening of the national power grid, then the line could be paid by Statnett, the owner of the national power grid. Ongoing strengthening of the national power grid in Mid Norway Statnett is upgrading several overhead power lines in the region from 300 kV to 420 kV, giving a significant increase of the transport capacity (we refer to the illustration): Namsos – Verdal – Klæbu Klæbu – Trollheim Planned upgrade from Namsos to Røssåga (270 km). There is an existing 420 kV line from Klæbu to Trollheim in parallel with the old 300 kV line. When the 300 kV line from Klæbu to Trollheim is upgraded to 420 kV, there will be two parallel 420 kV lines from Klæbu to Trollheim, with a strong transport capacity and a good fault reserve. In other words, the national grid in Mid Norway will be strong, and with a good fault reserve, included the connections with the Swedish grid (420 kV), from Klæbu and north from Røssåga. Illustration: Existing and planned 420 kV lines in Mid Norway No new wind power – no new power line built by Statnett Statnett requires an investment decision of totally 1000 MW wind power installations in Fosen and Snillfjord/ Hitra as a condition to build a new power line; Namsos – Storheia – Snillfjord – Trollheim. Without a decision to build at least 1000 MW wind power (with varying models of distribution of wind power sites between Fosen and Snillfjord/ Hitra), Statnett refuses to build a new line. In other words, Statnett has no general need to strengthen the national grid in Trøndelag. The ongoing upgrading of existing lines is sufficient. New 1000 MW wind power to be run without a connection between Storheia and Snillfjord New wind power installations must be operative within the end of 2021 to get the general support of about NOK 0.15/ kWh from the Norway/ Sweden renewable electricity agreement. This means that the installations in Fosen and Snillfjord/ Hitra must be operative and connected to the national grid before 2021. This is to be done with the help of two new (radial) power lines: From Storheia to Namsos to connect the four Fosen installations (750 MW) From Snillfjord to Trollheim to connect the two installations in Snillfjord and Hitra (250 MW) The existing and upgraded national grid between Namsos and Trollheim (and Namsos – Røssåga) will have sufficient capacity to transport the new wind power without a new power line from Storheia to Snillfjord. Included the connections to Sweden there will also be a good fault capacity. Connection between Storheia and Snillfjord in 2028 As shown in the previous part, the new wind power installations of 1000 MW are going to be connected to the national grid through the two separate power lines Namsos – Storheia and Snillfjord – Trollheim, without any need for a connection between Storheia and Snillfjord. According to Statnett’s plan, this is going to be the normal situation for 7 years: The radial connection from the Fosen wind installations to Namsos and the radial connection from Snillfjord to Trollheim will be operative together the wind installations before 2021. The connection between Storheia and Snillfjord is planned to be operative in 2028 Statnett sent an application to the Department of Oil and Energy to postpone the opening of the connection between Storheia and Snillfjord to 2028. Statnett has to build this line, in order to classify the power line Namsos – Storheia – Snillfjord – Trollheim as a part of the national grid. The Department of Oil and Energy accepted postponing of the Storheia – Snillfjord line, and writes: “Statnett’s argument is that a possible further building of wind power in Fosen, greater than the new line Namsos – Roan – Storheia is able to transport, will be the first to create a need for building the Storheia – Snillfjord line” 1. (Our translation) In other word, the main formal argument for building the new line is that it would open the possibility of connecting several new wind power installations in the region after 2021. Very unlikely to get new wind power plants installations after 2021 Statnett’s formal argument for the new line is not well founded, as any new wind power installations after 2021 will not get the general support of about NOK 0.15/kW, a support that is crucial for the economy of the power plants. Even with a support of NOK 0.15/kW, it has proven very difficult, not to say impossible to get a solid economy, as all forecasts for the electricity market price tell about a lasting low price level for many years to come. The Norwegian government has stated that the agreement between Norway and Sweden for the renewable electricity certificates (the market price is now about NOK 0.15/kWh) will not be prolonged. Both the main organisations for electricity companies in Norway and Sweden, have warned against any new subsidies for wind power. Their argument is that it would be damaging for the electricity market. In other words, the situation in the electricity market, and no continued support of new wind power on land, makes it very unlikely that there will be built new wind power installations in Fosen after 2021, and this means that Statnett for the time being has no reason and no need to build a 1 Ministry of Petroleum and Energy, Postponed implementation of a new 420 kV power line Storheia – Snillfjord, 17.04.2015. connection between Storheia and Snillfjord as a part of the national power grid. This situation could last for many years to come, if not forever. Conclusions 1. The national grid in Trøndelag is strong, and with a good reserve capacity in case of faults, with extra strength due to strong connections to Sweden. There is no need for a new parallel 420 kV line. 2. The new 1000 MW wind power installations in Trøndelag are going to be connected to the national grid through two separate radial lines, and the existing and upgraded national grid is sufficient to transport this new power. 3. The electricity market situation and most forecasts for future price levels makes it impro- bable that there will be built new wind power plants in Trøndelag without the extra support of renewable electricity certificates of about NOK 0.15/kWh. 4. In this situation there is no need for a connection between Storheia and Snillfjord as a part of the national power grid. 5. The two radial power lines between Storheia and Namsos, and between Snillfjord and Trollheim are ordinary connections from wind power plants to the national grid, and should be paid by the wind power companies. Defining these lines as a part of the national grid is not valid. In the early phase of the wind turbine projects in Fosen, it was said that these lines were going to be paid by the power companies, but this was changed later. 6. The cost of a line Namsos – Storheia – Snillfjord – Trollheim is estimated to about NOK 5.5 billion. The cost of the two radial lines, Namsos – Storheia and Snillfjord – Trollheim could be about NOK 4 billion. 7. If these lines are paid for by Statnett (and the electricity customers), the value of these lines of about NOK 4 billion represents an extra economic support that is not given to other wind power plants or hydro power plants, and this will be in breach of the general market rules of the European Union.