Letter from the reader This is a debate item, written by an external contributor. The post expresses the views of the writer.
The survey of NHO members in November shows that the future prospects have weakened further. 52% of companies in the interior foresee a worsening of the market situation in the next six months, only 8% report an improvement.
Deteriorating mood is not a fluke.
In the recent November NHO member survey, 25% of inside companies report that the current situation is bad, which is similar to the October survey. The future prospects are further weakened: 52 per cent of companies in the internal region foresee a worsening of the market situation in the next six months, only 8 per cent report an improvement.
Decline in all sectors
The survey shows that all sectors now have a preponderance of pessimists. The greatest preponderance of pessimists is in the construction, automotive and food industries. All counties also have a preponderance of pessimists. Rogaland has fewer pessimists, Innlandet more.
We considered the October data for Innlandet to be surprisingly weak when it arrived. When November comes out at roughly the same level, he argues that the mood deterioration in October was not due to chance or was a fluke.
With the end of the year approaching, this time we also asked companies if – and under what conditions – they might be interested in subscribing to a fixed price for electricity. 316 NHO companies in the inner region responded.
· More than half (53%) of Inland companies say it might be interesting to sign a fixed price contract for electricity.
· Of these, as many as 9 out of 10 companies (91%) in the hinterland state that they want a short commitment period, ie three years or less. Since three years will be the shortest commitment period that will be offered, many of these will have to refrain from committing or, in other words, choose a longer commitment period than they now declare they want.
Price is of course of great importance. Of those wishing to fix the price, 7 out of 10 (72%) say they want a price below 70 øre / kWh.
New fixed price regime
The government recently presented a clarification on the new contractual exemption in the land rental tax, which is pending in the Storting. The contractual exception should better facilitate fixed price agreements for electricity. An amendment is also made to the proposal on high-priced subsidies for energy production.
It is good that the framework conditions for fixed price agreements are finally in place. I am concerned about many of our member companies within. They need predictability and electricity bills that they can live with. At the time of writing, future prices indicate an average price for Eastern Norway for the next three years of around 130 øre / kWh.
If the prices in the market remain here even into the new year, our responses may indicate that interest in fixed prices will be very low. It is therefore conceivable that some also emphasize the liquidity effect of freezing the price of electricity at levels below the current spot price.
Importantly, it is the market that determines the prices. They are neither adopted by politicians, ministries or NHOs. But we are all interested in a market that works as well as possible. The price level in these deals depends on the market as a whole and we have to deal with the great uncertainty.
It must be up to each individual company if they believe that a fixed price deal is favorable enough for them. We have always said that if the electricity subsidy scheme is to end on New Year’s Eve, a well-functioning fixed price system must be in place on 1 January. We support it.
