Following a tacit faceoff with France in the wake of cancellation of a submarine deal between France, United Kingdom and Australia, the UK has closed a mega power deal with Norway targeted at reducing wholesale electricity prices, potentially to the tune of £3.5 billion over the next 25 years.
According to the Department for Business, Energy and Industrial Strategy, the agreement is prequel to the start of commercial testing operations in October of the North Sea Link, the first electricity interconnector between the two European nations.
The 1,400 megawatt (MW) cable’s start-up is projected to provide a viable solution to soaring electricity prices in both countries, even though UK prices are at a steep premium, the implication is that it will initially export power from Norway to Britain.
The UK is also expected to benefit from Norway’s vast hydropower resources to aid balance intermittent wind power.
Norway, on the other hand, can import cheap surplus renewable energy in order to save water in its hydropower reservoirs.
“I am happy to sign a power trade agreement with the UK today,” said Lars Andreas Lunde, State Secretary in the Norway Ministry of Petroleum and Energy
“This agreement facilitates a predictable framework for power trade and strengthens cooperation between our two countries.”
The deal was brokered by the Ministry of Petroleum and Energy and the British Ministry of Business, Energy and Industrial Strategy sequel to negotiations on free trade agreement between the EEA countries and the UK.
A Foreign Office minister believes an agreement originally designed to help UK and US pool resources to develop a new fleet of nuclear-powered submarines for the Australian navy “is not about France” after a contract between France and Australia was nullified.
Speaking with Sky News, James Cleverley said that the agreement – known as Aukus – was instead “about our very strong relationship with the United States of America and Australia, it’s about reinforcing an incredibly important and strong defence relationship, and it is also about making sure that we have hi-tech manufacturing jobs here in the UK, that’s what this is about.”
He said: “Obviously, with any international relationship, there are ups and downs, and I have no doubt that we will ultimately resolve any frictions that there are currently with France. But this is actually about making sure that A, we are protected, and B, that we are closely aligned with two of our strongest and most long-standing defence and security partners in the world.”