Blog Post

UK and Norway trade deal to bolster non-EU energy imports

Richard Simmonds • June 22, 2021

The UK has made a deal with Norway to exchange renewable energy, the first time such a deal has been made with a non- Eu country. Following last month’s standoff with the EU and French threats to cut off power to the isle of Jersey, the UK is looking to secure its overseas imports of energy.

A needed non-EU source

The trade deal comes after the UK and Norway completed the laying of the world’s longest submarine power cable and will allow both nations to exchange renewable energy.

The cable called the North Sea Link stretches from Kvilldal, Suldal, in Norway, to Cambois near Blyth in the United Kingdom and will begin operation on October 1^st.

Interconnectors are a key part of the UK strategy for cutting emissions and boosting offshore wind because they allow the UK grid to share or import power depending on supply and demand.

The deal will see the UK sending excess wind power to Norway with Hydropower coming to the UK in return.

Following the standoff between the UK and France in May over fishing rights and concerns that the Brexit deal agreed at the start of the year gives the EU the ability to effectively hold the UK’s energy imports to ransom if a deal over fishing rights cannot be negotiated, such deals with non-EU countries is needed.

“When it is windy in England and wind energy production is high, we in Norway will be able to buy cheap electricity from the British and leave the water in our dams. When there is less wind and a greater need for electricity in England, they will again be able to buy hydropower from us,” said project director at Norway state-owned power company Statnett.

The UK’s National Grid owns 50% of the North Sea Link project and has stated that the UK will need to increase its interconnector capacity from 6 GW to 18 GW by 2030 in order to achieve its Green targets.

Also read: France’s threat to cut off electricity to Jersey proves the UK needs to rely less on the EU for energy

Benefit for consumers

According to Ofgem, the new cable link and energy trade deal will contribute around £490 million to the welfare of the UK and £330 million to Norway.

Consumers in the UK are forecast to benefit as once the cable begins full operations in October the average domestic energy bill is expected to fall by £2 per year.

“The Norway deal was a real Brexit win for the UK. The project will significantly benefit Britain’s energy sector, especially in renewables. Whilst power connections from EU member states are still a key factor in UK energy, we are keen to forge new links with other countries and increase our own energy output. We also keen to increase our reliance on renewable power sources such as offshore wind and this Norway project helps to achieve that. This is a huge turning point for UK power,” said a UK government spokesman.

Also read: Wind Energy breaks new record and the link between Fishing and Energy in the Brexit Trade deal

Dyball offers a range of software and services to help energy suppliers. These include:

· Energy Supplier & Energy Billing System

· Customer Self-service Portal

· Customer Switching Portal

· DCC Adapter

· Energy Managed Services

Looking to enter the UK energy market? Dyball Associates team of energy market consultants can guide you through the steps to get qualified and attain your gas or electricity licence.

Whether you’re looking for electricity and gas systems or support on starting an energy supply company, Dyball Associates can help.