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Record High Electricity Prices and Reduced Power Production in the North
Three of Northern Norway's most important hydropower plants are completely or partially out of operation. At the same time, the region has experienced some of its highest electricity prices in several years.
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Long-term cold and high consumption have led to an increase in electricity prices across the country. On February 9th, Northern Norway reached a spot price of NOK 3.93 per kilowatt-hour, the highest price in the region since December 2022, according to Europower.
January was also historically expensive. The monthly average price in the North ended at around 83.09 øre per kWh (before VAT and grid rent), a stark contrast to January 2025, when the average price was as low as 10.93 øre.
The high prices have already had consequences. Elkem has shut down furnaces in both Salten and Rana and laid off employees, with electricity prices being one of the reasons.
Average electricity price per month in Northern Norway
Northern Norway has gone from record low to unusually high electricity prices in one year. Source: NVE
900 MW gone
At the same time, three of Northern Norway's largest hydropower plants are completely or partially out of operation: Svartisen, Kobbelv, and Rana.
The Svartisen power plant has been closed since December 1st. The entire facility has been drained of water to carry out planned and legally required maintenance of the water tunnels. The work is scheduled to be completed in May.
Kobbelv power plant has two machines out of operation following a generator failure in December, and Rana power plant has one of four machines shut down for turbine rehabilitation.
In total, the loss amounts to around 900 MW in production capacity.
Need to empty the tunnels to access
The maintenance work in the power plants involves completely emptying the water tunnels so that personnel can work safely inside the mountain.
How does hydropower affect electricity prices?
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Norway is a hydropower country
About 90 percent of Norwegian electricity comes from hydropower. Water can be stored in reservoirs, so production can be adjusted as needed.
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Weather controls production
A lot of water in the reservoirs or a lot of wind power in the Nordics results in lower prices. Little water, little wind, or high consumption pushes prices up.
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Norway and Sweden share a power market
Norway is closely connected to Sweden, Denmark, and Finland through a common Nordic power market. Electricity flows where the need is greatest, and prices affect each other.
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When power plants shut down, supply falls
When large hydropower plants are out of operation, an important part of production disappears. Less available power results in higher prices, especially during cold periods.
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Prices spread across borders
Many households and businesses pay the spot price. Therefore, energy shortages or high prices in neighboring countries quickly impact Norwegian electricity prices.
"The components we are working on are normally underwater. So we have to stop production so that it is possible to have personnel and equipment in the tunnels. This work requires proper planning and preparation, both in terms of operation and safety," says Stein Harald Engen, maintenance manager at Svartisen power plant, in a press release.
The Svartisen power plant was put into operation in 1993, and this is the first time the waterways have been emptied for this sort of maintenance.
The fact that the work takes place in the middle of winter, and not in the summer when electricity demand is lowest, is not accidental.
"We have to carry out this work in winter because that is when there is the least meltwater from the glacier," explains Engen.
The intake streams in Holandsfjorden receive large amounts of water from the Svartisen glacier in the summer months. Closing the tunnels then can lead to flood damage.
Swedish power plants under pressure
The development in Sweden, which is the EU's largest hydropower producer, also contributes to a more vulnerable power system in the High North. Many of Sweden's 2,000 small hydropower plants are at risk of shutting down due to the EU's strict and costly environmental requirements.
According to Dagens industri, several owners are considering shutting down operations completely, which could lead to a "mass shutdown" of small hydropower in the country.
For Norway, this means that an important source of flexible production in the High North could be further weakened, at a time when cold temperatures, high consumption, and reduced Norwegian hydropower production are already impacting the power balance.
Meanwhile, the Swedes are also feeling the pressure. Never before has Norrbotten had as high electricity prices as in January. This year's average price ended at 94 öre, up from 24 öre in January last year, an increase of almost 300 percent, writes SVT.
"A combination"
Statkraft's regional director in the North, Maren Sisilie Joné, says to NRK that several factors are driving electricity prices up. She points to cold temperatures, high consumption, and little wind in northern Sweden as important factors, but acknowledges that closed power plants also play a role.
"It is probably a combination. There are 900 MW that are not being offered to the northern Norwegian market in hydropower," she says.
Joné says it is difficult to determine if the situation could have been avoided.
"We will, of course, learn from what we see now and take it with us into future maintenance. The power plants are reaching an age where they need more extensive maintenance, and we must plan well so that we can still offer power to the market."
