David Morey 
Electricity is priced differently all over the world, and numerous factors affect those prices. If you take a quick look at the prices in Europe, provided here, you will realize that Norway is among those countries in which power is cheapest. That is in itself a good thing, but it doesn’t automatically mean that you shouldn’t take note of the contract you have, or take time to change it if you think you could score a better deal.
A crucial difference to understand here is the difference between the spotpris and the fixed one. By doing so, you will get to understand if your current contract is favorable, or if you should think about making some changes. The truth is, though, that a lot of people don’t quite comprehend the concept of the spot price, or its advantages.
While you might have heard other people’s stories and their conclusions that the spot price is the cheapest option, you don’t want to adopt such an opinion without exploring the topic yourself. What you want to do instead is get a clearer understanding of this whole concept, so that you can see for yourself whether it is as favorable as people are saying it is. For starters, you need to know what it is and how it is calculated.
Furthermore, you also want to understand what the advantages of getting a contract with this price type are. And, of course, the question of whether this is the cheapest option will constantly be on your mind during the research, so that is another one that you need to have answered. Below I’ll answer all of those questions for you, one at a time, hoping to make things as clear as possible and to, thus, give you a push into the right direction if you’re at a crossroads and unable to decide for or against the spot price.
What Is the Spot Price?
Let us begin with the basics here. The thing you’re wondering is – hva er spotpris, or what exactly is the spot price? Without comprehending those basics, there is no point in going any further, so let me give you a clear and simple answer to this particular question.
The spot price is the market price. Meaning, that you pay the same amount that the supplier pays when buying the electricity on the Nord Pole. It is something like buying a product at its wholesale instead of its retail price. Doesn’t that sound amazing?
Well, it most definitely does, but you need to understand further implications of it. The market we’re talking about is constantly experiencing changes in supply and demand. And, if you know anything about economics, then you know the main market principle that says that the supply and the demand have the ultimate impact on the price. Things are no different when electricity is in question.
Let me get a bit more specific here and explain things more precisely. Due to the fluctuations in the market, the spot price will constantly be changing. It changes not only from month to month or day to day but also from hour to hour. Apart from that, the actual price you’ll be paying will depend on the demand, meaning that it will increase when the demand is higher, such as on very cold winter days. This is because most people will use much more electricity to heat their homes during those cold winter months, meaning that the demand will increase.
Furthermore, this price will also depend on where you live, since the demand is not the same in all the areas of Norway. In any case, the spot price is suitable for those people who can tolerate the fluctuations and the unpredictability of the bills. If you’re not among them, perhaps the fixed solution could be better for you.
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What Are Its Advantages?
The above has probably made things much clearer, but it could have left you a bit confused as well. Since you won’t exactly be able to calculate your bills precisely from one month to another, due to those demand and supply fluctuations I have been talking about, you must be wondering one thing. What exactly is the advantage of the spotrpis and why should you, thus, consider using it at all?
Well, if you don’t understand this, then it means you are thinking about the fluctuations only in terms of increases, while there are decreases from time to time as well. So, the advantage lies in the fact that you will be paying precisely the same price as the supplier pays on the Nord Pole, which is essentially like buying something directly from the manufacturer, and the costs are bound to be lower that way. Plus, there are months when the demand isn’t that high, which will drive the spot price down and allow you to enjoy much lower bills.
Is it the Most Affordable Option?
So, you now get how this concept works, how it is calculated, and why it can be advantageous. That leaves you with just one simple question. Is this the cheapest option? Being aware of the fluctuations means you’re also aware of the fact that the bills will sometimes be higher and sometimes lower, that is, unpredictable, which is the opposite of the fixed option which leads to your bills being rather predictable. Given all of that, can we say that this is the cheapest solution?
Yes, yes we can! If you look at it in the long run, this is undeniably the cheapest solution, and you should by now understand why. After all, buying things directly from the manufacturer is always cheaper than buying them from a reseller. Using the same logic here, you’ll automatically realize that the spot price is the most favorable and the cheapest option in the long run and that it is, thus, the perfect solution for everyone who can tolerate those fluctuations and a pinch of unpredictability.
