– Can solve the entanglement of wind power – E24

Municipalities and the wind energy industry have long debated how they can secure municipalities more money from this activity.

There is now an agreement on a joint proposal between the municipal organization KS, Samfunnsbedriftene, Energi Norge, Norwea, Naturressurskommunene (LVK), Utmarkskommunenes sammenlutning (USS), Industrikommunene, Petroleumskommunene, Kraftfylka and Landssammenslutningen averindkra ver.

Together, they have sent a letter to the Storting with several concrete proposals:

• a natural resource tax for wind power, on par with hydro power, which secures more money for counties and municipalities that host wind power
• an environmental tax (tax on nature, etc.) that should compensate local communities for disadvantages to the population and the environment
• a long-term study of the tax system for energy production

– This is a landmark deal that the wind energy complex can solve, says director Cecilie Bjelland at Samfunnsbedriftene (formerly KS Bedrift) in a message.

She says the advantages of wind power are global and national, while the disadvantages are largely local, which can contribute to conflict.

– Therefore, it is urgent to put in place plans that guarantee the municipal sector compensation for the disadvantages and a greater part of the value creation that the collection of local natural resources provides, says Bjelland.

Prime Minister Erna Solberg has suspended the licensing process for wind farms until further notice.

I’ve wanted my own tax for a long time

The energy industry at Energi Norge and the wind industry organization Norwea have long argued that municipalities should receive their own tax on natural resources. They wanted a production-based rate of a few cents per kilowatt hour.

Then, however, the taxes must be redistributed from the state to the municipalities, requiring the government and the Ministry of Finance to give up part of the tax revenue they receive today.

– Now all the municipal Norway and the energy industry are coming together and asking the Storting to fix this, says leader Thomas Bjørdal at LNVK to E24.

-But the state must give income to the municipalities, do you want it?

– It’s just that. This could have been resolved many years ago, but it assumes that the state is willing to give up some of its revenue and make sure it is distributed directly to municipalities that have given up land, he says.

Today, a relatively large wind power municipality typically receives between SEK 7-10 million through property tax. Corporation tax goes to the state.

A natural resource tax based on a hydroelectric power model could potentially give that municipality several million more, and it will also be more predictable than just the property tax, according to wind municipalities.

Receive only property tax

While the hydropower host municipalities receive both the property tax, a portion of the energy produced (license power) and the license fee, the wind power municipalities only receive the property tax.

In 2018, the hydropower owner and host municipalities received NOK 65 billion in taxes, fees and dividends.

Wind energy municipalities only get a small fraction of this, although this is partly due to the fact that hydropower has other properties and is much more profitable than wind energy.

Wind power municipalities have long demanded higher compensation and a more stable income that the state cannot change the way the property tax does.

LNVK was disappointed when the government this summer no suggestion occurred to him in the wind energy report on increasing compensation.

The wind energy report is now under review by the Storting. It didn’t provide more money for municipalities, just a tightening of the licensing system that would increase local codetermination.

– There is probably no municipality joining a new development, even with this new licensing process, as long as there is no compensation, Bjørdal at LNVK told E24 in June.

Will discuss the level

The letter to the Storting’s energy and environment committee says nothing about how many øre per kilowatt hour the charges should be. The Norwea wind industry organization says this needs to be discussed.

– As we said before, the municipal sector and industry must participate in the design and level of an environmental tax for new wind turbines, but the level must be perceived as a reasonable compensation, at the same time that profitable socio-economic investments can be made Says leader Øyvind Isachsen in Norwea in Message.

– So we must remember that the wind power being built now is a decided investment under a different regime and often has marginal profitability, says Isachsen.

End point in licenses

There is currently a total stoppage in the processing of wind licenses at NVE. Wind industry players fear that it will take many years to process new licenses after the system has been changed, which can probably happen from 2022.

Norwea predicts a sharp brake on new wind developments after 2021. At the same time, Statnett and NVE expect a sharp increase in energy demand through the electrification of the oil industry and the transportation sector and the development of power centers. data and battery factories.

NVE says Norway faces demanding decisions about how much new production will be developed and how much the country will be electrified from oil industry and activities.

According to NVE, a scenario with a significant electrification of industry and oil could drive the price of electricity to 45 øre per kilowatt hour on average in 2040.

However, this could be reduced by around five øre per kilowatt hour if an additional 13 TWh of wind power is developed over the next twenty years, NVE’s calculations show.

Over the past two years, electricity prices in Norway, excluding grid rental and tariffs, have averaged around 40 øre. At the beginning of this decade, the price used to be around 30 øre.