The Polar Retrospective – Negative and positive energy on Svalbard
The Polar Retrospective looks at stories of the past week that are related to the Arctic and Antarctic and focuses on one or more aspects. Today, we look towards Longyearbyen on Svalbard, where news about electricity costs and tourism have generated both negative and positive energy.
As in neighboring Iceland on the Reykjanes peninsula, things have been bubbling under the surface in Longyearbyen on Svalbard for some time now. However, the causes are not natural processes, but human decisions that have a drastic impact on the everyday lives of the population of Longyearbyen.
Negative energy versus energy supplier
The local energy supplier Svalbard Energi AS decided to increase electricity prices in order to cover the costs of supplying the 2,500 or so inhabitants with electricity. In consequence, many households received bills that were substantially higher than the previous year’s. According to reports in the local newspaper Svalbardposten, the increases amounted to up to 120 percent on the previous year’s bills after deduction of the state subsidy. This came as a shock to many residents, some of whom have to take on several jobs to cover their living costs. The reaction to the sharp price increases on social media and in e-mails to the municipal council was accordingly fierce.
According to the company, the reason for the massive increases was the rise in costs. These were due to the new diesel generators that were installed after the coal phase-out and which posed “operational challenges”. In addition, the board of directors of Svalbard Energi AS also blamed the rise in diesel prices. In total, the company will face costs of around 284 million kroner (approx. 24 million euros), as the head of the administrative committee explained at a meeting at the beginning of last week.
In addition to the revenues from the bills, there is also a state electricity subsidy of 125 million kroner (approx. 10.5 million euros), an investment grant of 42 million kroner (approx. 3.5 million euros) and a loan from the municipality of Longyearbyen of 25 million kroner (approx. 2.1 million euros). The latter, however, will be paid back from the subsidy fund. In the end, according to the manager at the meeting, electricity and heating would have to be operated according to the principle of cost recovery, reports Svalbardposten in its issue of July 20. This means that almost 100 million kroner in costs will have to be covered by the approximately 2,500 inhabitants.
The local council, which is also the owner of Svalbard Energi AS, was forced to call an extraordinary meeting due to the numerous negative comments and complaints. At the end, it was decided that the invoices would be canceled and recalculated. The calculations would then be based on the previous tariff structure.
Nevertheless, the people of Longyearbyen will have to adjust to higher prices in the coming year. Both the local council and Svalbard Energi AS are convinced of this. Instead of coal, which was previously subsidized by the state, the company now has to source diesel from a “competitive international market”. The state electricity subsidy, which accounts for the lion’s share of revenue, is also no longer sufficient. The amount dates back to 2012, a time when “cheaper” coal was used for production and the population of Longyearbyen was around 23 percent lower. However, it is questionable whether the government in Oslo is prepared to make a new decision in this direction.
Positive energy for expedition vessels
Another decision that was made in faraway Oslo and has had a lasting impact on the lives of the people of Longyearbyen was the tighter regulation of tourism on Svalbard. This particularly applies to cruise tourism. The government’s new strategy limits activities to a few dozen landing sites, imposes stricter regulations on the vessels that are allowed to approach Svalbard and also regulates the activities of local providers in many respects. The aim, according to the strategy, is to provide greater protection for the Arctic environment and the local population from the negative effects of a rapidly growing cruise tourism industry.
In fact, many people are critical of classic cruise vessels that come to Longyearbyen with thousands of guests. This is a result of a study, that was presented last week. Two Norwegian researchers, Kristin Løseth and Agnes Brudvik Engeset, were commissioned by Visit Svalbard to investigate the interaction between the local population and cruise tourism and possible tolerance limits. They concluded that the population in Longyearbyen generally considers tourism to be important for economic development, but would rather have expedition tourism than the classic cruise vessels The former are more interested and respectful in their dealings and also bring more money into the tills of local stores. They also put less strain on the infrastructure than when thousands of people come to Longyearbyen at once.
These results are in line with previous studies and surveys carried out by researchers and also by the AECO (Association of Arctic Expedition Cruise Operators), which came to similar conclusions.
At the same time, the population is asking how to reconcile the growing tourism with sustainability, especially in view of the increasing impact of climate change. The keyword here is “tolerance limit”. Creating such a limit should help to develop a kind of seal of quality for Longyearbyen as a sustainable tourist destination. All local interest groups, including those without a direct connection to tourism, should be involved in this, according to the researchers. However, this result is in contrast to the decision of the Norwegian government regarding tourism on Svalbard. Many local interest groups feel that they have been ignored. The operators of small expedition vessels also view the new laws and regulations with skepticism. Many would have welcomed a more differentiated strategy that took into account the differences between classic and expedition cruise tourism. As a result, first operators have (also due to the increasing number of operators) relocated their operations from Svalbard to Greenland.
But the others are at least being met with a wave of positive energy.
Dr. Michael Wenger, Polar Journal AG
Featured image: Marcel Schütz, Svalbard Photography
More on the subject
