About the transmission tariff
What is transmission tariff?
When using energy, you have to pay for two products. You pay one price for the energy you purchase from your energy supplier. In addition, you pay transmission tariff to your local network company for the transportation of the energy. All residents of Aust- and Vest-Agder counties pay transmission tariff to Agder Energi Nett AS.
What does the transmission tariff cover?
The transmission tariff is spent on maintaining a safe and efficient operation of the power network. It is mainly used for development and maintenance. Moreover, a considerable part of the transmission tariff is spent on value-added tax and two other public charges: Taxes on expenditure and payment to the energy fund (Enova). Regardless of the amount of energy transported, the price for operating the network is practically the same.
Is the transmission tariff based on consumption?
The transmission tariff is apportioned based on a fixed annual amount and an energy component, which is the amount you pay per kWh used.
May Agder Energi Nett determine its own transmission tariff?
The authorities set the framework of the total earnings, but Agder Energi Nett determines the level and the distribution between fixed component and energy component. Consequently, the transmission tariff is calculated in three steps:
1. The authorities determine the limits of a network company’s earnings.
2. The company estimates the customers’ kWh consumption in the year to come.
3. Based on this, transmission tariff per kWh and fixed component are calculated.
What may lead to an increased transmission tariff?
The following circumstances may result in an increased transmission tariff:
• Increased demand for investments and renewal of the network
• Increased demand for maintenance
• Increased public charges
• Increased interest rate level resulting in a demand for higher yields
• Increased investments or expenses in the central grid (Statnett)
Does a low energy price lead to an increased transmission tariff?
There is no connection between energy price and transmission tariff.
The network companies cannot increase their transmission tariff to compensate for the fact that the energy producers or suppliers get reduced earnings due to a lower market price. The calculation of the transmission tariff is subject to strict regulations.
Why do the network companies have a monopoly?
The power network is a natural monopoly because it does not make any sense to build two supply systems to the same house. This is why the network companies are regulated.
The network companies operate, maintain and develop the network in their respective geographical areas. The transmission tariff varies from company to company owing to the fact that natural conditions result in different costs for the companies. Agder Energi Nett is the owner of the power network in the Agder region.
The following components made up the electricity bill for an average customer in 2019. Annual consumption 20,000 kWh:
42,5 % Power
22,0 % Transmission tariff
35,5 % Public charges