380399
380399
friartikkel
2019-03-11T08:00:00.000Z
en

Distribution is part of the electricity supply in PPI as of 2019

Published:

Electricity supply as a business area consists of several things, including production and distribution of electricity. The latter was included in the Producer Price Index (PPI) as of 2019. Previously, the price index of electricity only covered the production itself (price of electric power). Distribution includes the operation of the distribution network that transports the electricity. For households this comes on the electricity bill as a distribution network tariff.

Production and distribution of electric power will be published as a total sub-index for electricity supply. Distribution is not included in the price index of first hand domestic sales (PIF) since distribution is a service and PIF only measures the price development of goods. The electricity index will therefore deviate between PPI and PIF from 2019 and onwards.

The price development of distribution fluctuates less than the electricity price. This contributes to dampening the large price movements in the price index of the electricity supply. The price index of electricity in the PPI before and after 2019 will therefore have relatively different content.

Numbers from the NVE (the Norwegian water resources and energy directorate) show different levels in the network tariffs between different consumer groups, such as households, businesses and those with cabins or leisure properties. Nevertheless, the price development over time is comparable across the different consumer groups. Since the target of producing the PPI is to measure price developments over time, the network rent for households is used as an approximate for the general price development in the distribution network tariff. 

New indices for production in the export and import market in the PPI and PIF

From January 2019, the system price from Nord Pool is used for the export and import market. Before 2019, the price development of the electric power production sold to Norwegian consumers were used for both these two markets.

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