Norway to Subsidize Households for Rising Electricity Costs
(Bloomberg) -- Norway’s government announced an aid package totaling more than 8 billion kroner ($890 million) to help mitigate the impact of record electricity prices hitting households across Europe.
The government will cover half of households’ power costs in the December to March period with market price of electricity above 70 ore per kilowatt hour, via deductions on their electricity bills, Prime Minister Jonas Gahr Store told a news conference in Oslo on Saturday.
“An extraordinary situation like this needs extraordinary measures,” Store said. “It is a powerful response to what we know many people experience as an acute and difficult situation.”
Skyrocketing energy costs are hitting European consumers due to a global shortage of natural gas, while soaring commodity markets are also pushing up food prices. Nordic power prices have surged to record levels in past weeks after some of the region’s biggest hydro plants were forced to curb output.
Read more: Norway Plans Action to Cushion Homes From Energy Crisis
Direct subsidies will amount to about 5 billion kroner, while an electricity tax cut will cost 2.9 billion kroner, the government said. The package includes steps announced earlier, such as a temporary raise of housing benefits by 1,500 kroner ($167) per household for a total cost of 500 million kroner, and higher subsidies for students.
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