Norway boosts hydropower, challenging effort to fill reservoirs
OSLO, Aug 17 (Reuters) - Hydropower production in southern Norway rose last week in response to high prices, potentially challenging Norway's efforts to fill reservoirs ahead of winter demand, a report by energy regulator NVE showed on Wednesday.
As drought has affected most of Europe and Norway has exported electricity to countries that have received less Russian gas than usual because of issues related to the Ukraine war, reservoir levels in southern Norway are lower than in average years.
The Norwegian government is preparing a mechanism to ensure refilling is prioritised over production and power exports at times of unusually low seasonal reservoir levels, but that is not expected to be in place until early next year.
Inga Nordberg, a director at NVE, said in a statement that the hydroelectric power produced in southern Norway in recent weeks had largely been generated by water that in any case would not have been stored long-term.
NVE also said that, although generation had risen week-on-week, it was still lower than during the same week at any point over the last decade.
Norway uses hydropower for around 90% of its electricity output and the country relies on having well-filled reservoirs for the peak-demand winter months.
The latest NVE report covers production from reservoirs capable of holding the equivalent of 100 gigawatt hours of hydroelectric production in the three southern Norwegian power price zones NO1, NO2 and NO5.
Reservoir levels in price zones NO1 and NO2 have fallen to their lowest point in at least 20 years as a dry year has limited restocking.
At the same time, Norway's hydropower prices have hit records, with the NO2 region of southwestern Norway recording its highest daily power price yet of 532.52 euros per megawatt hour (MWh) for delivery on Aug. 18.
The high prices, together with a requirement to maintain minimum levels in the rivers that feed reservoirs, encouraged utilities to increase production last week, Nordberg said.
Output would continue to vary week by week, she said, but added it was "very important that we maintain the long-term trend and hold back water that can be used to produce power until spring".
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