Norway’s planned £2bn power interconnector to Scotland may be scrapped in EU single market fall-out

Existing and planned interconnenctors, National Infrastructure Commission
Existing and planned interconnectors, National Infrastructure Commission

North Connect – the planned private-sector interconnector cable between Norway and Scotland – could be cancelled as a result of Norway’s adoption of the EU’s latest energy legislation.

The leader of the Norwegian parliament’s energy committee said that if the £2 billion project is to go ahead, it would need to be transferred to state-owned grid Statnett.

Barth Eide is a member of the main opposition Labour party, whose support is needed by Norway’s centre-right minority government to approve the latest EU energy legislation, required to maintain access and equal trade terms for its companies in the common market.

He told Reuters: “It <North Connect> will have to be transferred to Statnett. It’s Statnett or nothing. Of course that will not automatically mean it will be built for sure. It will be evaluated.”

Even if Statnett does take control of the project, the cable will be delayed, Eide said.

“In any case, North Connect will come later than the original plan. It will be years. Firstly we will have to assess Statnett’s cables that are now under construction,” he said.

North Connect’s current owners are Norway’s Agder Energi , Lyse and E-CO as well as Swedish state utility giant Vattenfall.

Labour agreed to back the government on the vote but demanded concessions to secure Norway’s energy sovereignty, including allowing only state-owned power cables to be built.

Norway’s influential energy unions have long lobbied against private cables, which were legalised under the previous government. Overturning that decision has been one of the Labour party’s promises before national elections last September.

Another Labour demand is postponing decisions to construct any future cables until Statnett completes two interconnectors it is currently building to Britain and Germany.

After these are built, their impact will be evaluated and only then can the Norwegian state decide to proceed with any other cables, said Eide.

There have been concerns that British plans for more power links with Europe to avert a looming electricity shortfall could be hindered if the country no longer has a say in European Union regulation of networks and power trading.

Britain faces an energy supply crunch by the early 2020s as coal power stations close and its oil and gas production declines.

To help boost supply, it plans new interconnectors with France, Denmark, Belgium and Norway to provide up to 14 gigawatts of additional capacity. Its current four interconnectors with Europe provide around 4 GW of capacity.

But if Britain leaves the EU, it might have to leave the bloc’s rule-making internal energy market (IEM) which coordinates access to energy across the EU.

23 Mar 2018

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