Transmission tariff

Landsnet´s tariff is prepared in accordance with the revenue cap set by the National Energy Authority at any given time and applies to both general users and power intensive users. Transmission charges are independent of the distance to the customer (the distance the electricity passes through the Landsnet system) or the distance between infeed or outfeed points.

The transmission tariff is largely based on the electricity that distributors and power intensive users draw from the transmission system at individual points of delivery. There are three types of tariff: The delivery charge, capacity charge and energy charge. 

There is a separate charge for transmission losses and ancillary services.

Landsnet negotiates the purchase of electricity for transmission losses every three months, following a call for tenders. The fee is determined by the purchase price of losses at any given time, as well as Landsnet´s 1,5% administration fee. The tariff for transmission losses is revised after each auction where the price of transmission losses is reflected in the real time market price.

Ancillary services include Landsnet´s purchase of spinning reserves, regulation power insurance and reserve power. Long-term contracts are made for the purchase of spinning reserves, agreements on regulation power insurance are valid for a year after the release of tenders and long-term contracts are made for reserve power. 

Calculations

A fixed annual delivery fee is collected for all point of delivery connected to the transmission system both infeed and outfeed points.

A capacity charge for out-feed is calculated based on the average of the four highest 60-minute monthly power-peaks of the year for each delivery point, whereas the energy charge is calculated for each MWh transferred through Landsnet´s system.

In addition, there is a fixed charge for transmission losses and ancillary service per KWh (outfeed). This fee is used to cover Landsnet´s purchase price for these services at any given time.

Landsnet´s tariff for power-intensive users is in USD, while other items are in ISK. 

Discounts

Landsnet is permitted to offer a discount for transmission services resulting in the more efficient utilisation of the transmission system, such as curtailable electricity. This applies, for example, to the delivery and transmission of voltages higher than 66 kW. Landsnet can make curtailments to curtailable electricity, without providing compensation, if operational disruptions occur in the system.

Domestic electricity bills

The electricity bill of individual and companies specifies the cost of transmission which is usually about 10% of the total amount which includes energy prices and the cost of transmission and distribution.

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