Integration of utilities

I came across the following press release about the state of the Scandinavian power utility whilst hunting for info on Bakun and the current submarine cable model, NorNet– and the argument for efficiency and least cost generation is a compelling one. Just think if we do not have so much cheese with kiasu-ness and being territorial and playing politics, TNB should possibly own Singapore’s electricity utilities, while buying bulk supply in an optimal ratio from internal power plants and IPPs.

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Source: http://www.statnett.no/en/The-power-system/About-the-power-system/Exchange-of-power/

The Nordic region and Europe

(11/4/2008)

Trading with other countries is important for Norway for several reasons.

The exchange of power with other countries is important for a number of reasons. In general, an increase in trade between countries results in more effective utilisation of power resources. The competition between power generators is reinforced, resulting in the most efficient generating resources being used at any one time. Overall, this will help to reduce the costs for end users, and at the same time strengthen the ability to overcome many different challenges. The exchange of power between countries also helps to make the power system and power market larger. This makes the system more robust and better able to face a wide variety of challenges.

For Norway, it is particularly important to be able to deal with situations with declining precipitation, as 99% of Norwegian power generation is based on hydroelectric power. The countries around us primarily use thermal power generation, and trading with them helps to improve the security of supply in Norway.

Norwegian hydroelectric power generation has a flexibility which can be valuable to our neighbouring countries. When consumption fluctuates rapidly in other countries, thermal generation can be both expensive and polluting to regulate compared with our hydroelectric power.

For Statnett, it is therefore important to work to ensure that effective market solutions are developed for the exchange of power between countries, and that sufficient investments are made in power lines which connect the markets closer together.