Start construction world’s longest subsea cable
Oslo, Norway – Statnett and TenneT, the national transmission system operators of Norway and the Netherlands, respectively, have agreed to begin construction of the NorNed subsea cable that will link the power supply systems of the two countries. The final contracts were signed in Amsterdam Thursday 30th of December 2004.
The 580-km-long HVDC interconnector, which crosses under the North Sea, will be the worldâ€™s longest subsea power link. The decision to go ahead with the project was made following NorNedâ€™s recent licensing by Norwegian and Dutch regulatory authorities.
â€œNorwegian and Dutch power markets complement each other extremely well, and in terms of security of supply, it is particularly fortunate that Statnett and TenneT have now been authorized to exchange electric power between Norway and the Netherlands,â€ says Statnettâ€™s chairman of the board Grete Faremo.
Manufacturing due to start early 2005
Now that TenneT has received NorNed licensing, all necessary regulatory approvals have been granted. Most project contracts have already been negotiated â€” and manufacturing of the HVDC cable will start in early 2005. The estimated project cost for each of the project partners is NOK 2.3 billion (approximately â‚¬ 300 million). Power trade via the cable will pay for the NorNed project.
The agreement between Statnett and TenneT is based on equal sharing of all expenses and revenues by the two TSOs. The NorNed cable will terminate in Kvinesdal in the Norwegian county of Vest-Agder, and Eemshaven in the Netherlands. â€œWe will begin work on the project immediately after the New Year. Power exchange with the Netherlands is scheduled to be operational by year-end 2007,â€ says Statnett President and CEO Odd HÃ¥kon HoelsÃ¦ter.
Practically all electric power generation in Norway comes from hydropower, while the Netherlandsâ€™ power system relies on traditional thermal power; the latter is unaffected by fluctuations in regional precipitation. This difference in energy sources allows the Norwegian and Dutch power systems to complement each otherâ€™s operations. NorNed will also contribute to enhanced security of supply in both countries.
Power exchange via NorNed will be based on market prices in the two countries; typically, Norway will export power during the day and import power at night. In years with below-normal precipitation, Norwayâ€™s imports via NorNed should significantly exceed its exports. Once NorNed is operational, it will improve integration of Nordic and Continental Europeâ€™s power markets, and will help stabilize power prices.