Norway-U.K. Power Cable Investors to Contest Private-Owner Ban

Vattenfall AB and E-CO Energi AS are among investors contesting Norway’s ban on private ownership of cross-border electricity cables, jeopardizing a planned power link with the U.K.

Norway adopted a law on June 7 that guarantees state-owned grid operator Statnett SF exclusive or majority control of all power links abroad, according to the minutes of a government vote posted on its website. The rule effectively bans privately owned, or merchant, cables.

The law may thwart the 1,400-megawatt Northconnect cable which would connect Norway to the U.K. by 2020, a project financed by utilities including Sweden’s Vattenfall, Norway’s E-CO Energi, Agder Energi AS and Lyse Energi AS. The country’s ban may breach European Free Trade Association, or EFTA, rules, according to Northconnect.

“We will start preparing our case, and will make a decision how to proceed with the court appeal in August,” Odd Oeygarden, chairman of the Northconnect owners group, said today by telephone from Kristiansand, Norway. “We’ll lodge a complaint with the EFTA surveillance authority to defend our planned cable.”

Norway’s petroleum and energy ministry had no immediate comment on Northconnect’s challenge, Jon Evang, a spokesman at the ministry, said today by phone from Oslo.

The country’s power-cable law is designed to improve energy security and make the electricity grid more efficient, according to the government. Statnett and the U.K.’s National Grid Plc (NG/) are planning their own link to allow Norway to export excess hydropower, according to the Norwegian grid operator.

The proposal has been open for public consultation since September and has drawn criticism from Northconnect, power industry association Energy Norway and opposition political parties.

To contact the reporter on this story: Torsten Fagerholm in Helsinki at tfagerholm@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.