Alternative Energy & Power 2021

Last Updated July 20, 2021

Norway

Law and Practice

Author



Advokatfirmaet Hjort DA was established in 1893, and has since become a well-known and leading litigation firm in Norway. Hjort has the structure and capacity to engage in all of the central legal areas, with a solid competency, amongst others within the renewable energy industry, in corporate legal assistance and dispute resolution. The firm's highly acclaimed judicial competency, combined with a corporate understanding and commercial appeal, are the reasons why it is considered to be an unparalleled contributing partner in regard to important and demanding legal cases.

General Structure

Norway has the highest share of electricity produced from renewable sources in Europe. In 2020, Norway set a new electricity production record of 154.2 TWh, divided on the following sources:

  • hydropower – 1,690 plants with a combined installed capacity of 33,055 MW, which in 2020 accounted for 88% of the total production;
  • wind power – 53 wind farms with a combined installed capacity of 3,977 MW, which in 2020 accounted for 10% of the total production;
  • thermal power plants accounted for about 2% of the total production.

The Norwegian hydropower system has a high storage capacity, accounting for about half of Europe’s total reservoir capacity. More than 75% of Norway’s production capacity is flexible, meaning that production can be rapidly increased and decreased according to needs and at a low cost. 

Central Authorities Responsible for Energy and Water Resource Management

The Norwegian Parliament (“Stortinget”) decides on the political framework for energy and water resources management in Norway. The government has the executive authority and implements its policy through the following ministries:

  • the Ministry of Petroleum and Energy (“Olje- og energidepartementet”), which has the overall administrative responsibility for energy and water resources;
  • the Ministry of Climate and Environment (“Klima- og miljødepartementet”), which is responsible for environmental legislation;
  • the Ministry of Local Government and Modernisation (“Kommunal og moderniseringsdepartementet”), which is responsible for planning legislation;
  • the Ministry of Finance (“Finansdepartementet”), which is responsible for taxation, government expenditure, etc; and
  • the Ministry of Trade, Industry and Fisheries (“Nærings- og fiskeridepartementet”) which oversees Statkraft SF, the state-owned electricity producer.

The Norwegian Water Resources and Energy Directorate (“Norges vassdrags- og energidirektorat” or the “Directorate”) reports to the MPE and is responsible for managing domestic energy resources, and is the national regulatory authority for the electricity sector.

The Directorate is involved in research and development, as well as international development co-operation. It is also the expert body on national hydrology.

Ownership Structure

In order to exploit hydropower resources in Norway and produce hydropower, the power producer has to acquire the necessary property rights for the waterfalls and pertinent rights (“fallrettigheter”) if the waterfall when harnessed can be expected to produce more than 4,000 natural horsepower (hp). Pursuant to the Waterfall Rights Act, a concession for acquisition of waterfall rights can only be issued to public bodies. These entities may be Norwegian state-owned enterprises, municipalities or county authorities, as well as companies where public bodies make up at least two-thirds of the capital and the votes. Private actors may thus only account for a maximum of one-third of the ownership in such companies. 

Norwegian municipalities, county authorities and the state own approximately 90% of Norwegian hydropower production. Through the wholly owned state enterprise Statkraft SF, the state owns approximately 30% of all production capacity in Norway.

There are no similar requirements for the public ownership of wind power plants, transmission or distribution facilities. However, in accordance with the principles of EU’s Third Energy Market Package, the Norwegian state, through its wholly owned company Statnett SF (the transmission system operator, TSO), now own almost 100% of the transmission grid.

Municipalities and public authorities, on the other hand, overwhelmingly own the distribution grids. 

Many of these grid companies are part of vertically integrated companies. However, from 1 January 2021, it is required that all grid companies are legally unbundled, and all grid companies with more than 10,000 customers must be functionally unbundled.

The following companies are at present the largest in Norway within the relevant energy segment.

Generation and Production

  • Statkraft SF (wholly owned by the Norwegian state);
  • Hafslund Eco AS;
  • Norsk Hydro ASA;
  • Agder Energi AS;
  • Lyse Produksjon AS;
  • BKK Produksjon AS.

Transmission

  • Statnett (wholly owned by the Norwegian state).

Distribution

  • Elvia AS;
  • Tensio AS;
  • BKK Nett AS;
  • Agder Energi Nett AS;
  • Lyse Elnett AS;
  • Arva AS.

Electricity Suppliers

  • Fjordkraft AS;
  • Hafslund Strøm AS;
  • Trøndelagkraft AS;
  • Lyse AS;
  • Eidsiva Energi AS;
  • Ishavskraft AS.

Under the current Waterfall Rights Act, a concession for acquisition of waterfall rights can only be issued to Norwegian public bodies (see also 1.1 Principal Laws Governing the Structure and Ownership of the Power Industry). There are no further restrictions as far as foreign investment is concerned.

While private actors (hereunder also foreign public bodies) may not own more than one-third of large hydropower production facilities, this requirement does not apply to smaller power-producing installations. Private actors may also own wind and solar power facilities. See also 1.4 Principal Laws Governing the Sale of Power Industry Assets.

The Security Act

One issue to be aware of is the Norwegian authorities’ possibility to screen investments in Norwegian businesses on the basis of national security.

These rules follows from the new and modernised Security Act (“Sikkerhetsloven”), which came into force on 1 January 2019.

The definition of national security interests is quite wide; if an investment could cause a “not insignificant” risk to national security, the authorities could either block said acquisition/investment or impose certain conditions for the transaction.

The screening regime will apply to both EU-based and non-EU based investors, and is not limited to specific sectors. It will generally apply to undertakings involved in “fundamental national functions: services, production and other types of activity which are of such importance that a complete or partial loss of the function would have consequences for the state's ability to protect national security interests”. As such, electricity production and transmission would generally be sectors that will be within the scope of such screening.

Each ministry will be responsible for protective security work in their areas of responsibility, and shall (i) identify and maintain an overview of fundamental national functions, and (ii) identify the relevant undertakings and maintain an overview of undertakings of material importance to fundamental national functions.

Any affected private company shall receive prior notice.

The principal laws that govern the sale of generation, transmission and distribution assets, and the amalgamation or merger of power industry entities, are as follows:

Pursuant to the Waterfall Rights Act, only public entities may obtain the necessary licence to exploit large waterfalls. The entities may be state-owned enterprises, municipalities, or county authorities, as well as companies where public bodies make up at least two-thirds of the capital and the votes.

Private actors (hereunder foreign public bodies) may thus only account for one-third of ownership in such companies. These requirements also apply in the event of sales of assets or business, as well as in conjunction with amalgamations and mergers. The essence of the matter is that private ownership of waterfalls may not exceed one-third.

The Norwegian Water Resources and Energy Directorate (NVE) has the overall responsibility for maintaining national power supplies, while Statnett SF is the Norwegian energy system operator.

The Norwegian electricity grid consists of two levels: the transmission grid and the distribution grid. Interconnectors with other countries are part of the transmission grid. 

Statnett operates the transmission lines nationwide and is responsible for the satisfactory security of supply at all times. This necessitates maintaining a power grid with adequate transmission capacity. It also involves being in charge of managing peaks in electricity consumption and allowing for the import of adequate quantities of electricity. 

Should the need to ration electricity arise, the Norwegian Water Resources and Energy Directorate is responsible for planning and administering the appropriate measures.

Interconnectors

In April 2021, the government proposed a change in the Energy Act, whereafter a licence for the ownership of cables going outside of the Norwegian borders (interconnectors) in general can only be granted to Statnett (as the TSO) or companies/undertakings where Statnett has a controlling interest.

However, the proposal opens up the possibility to grant a licence to a cable that goes from Norway and is connected to an offshore production unit (offshore wind farm), and from this production facility is connected also to another country.

For the sake of good order, the government emphasise that a possible cable from an offshore production unit directly to another country, without also having a cable to Norway (ie, not connecting the Norwegian grid to the foreign grid), will not be regulated by the Energy Act but would be part of the licensing process under the Norwegian Offshore Energy Act.

The proposed change has yet to be debated and decided upon in the Parliament.

From 1 January 2021, it is required that all grid companies are legally unbundled, and that all grid companies with more than 10,000 customers are functionally unbundled.

As of 1 January 2021, the Norwegian government opened two areas for offshore wind farms. Guidelines on how to apply for the areas were published on 11 June 2021.

Regarding onshore wind farms, the possibility to receive electricity certificates will expire at the end of 2021. The government has also decided that they will not, in general, extend the deadline for construction of wind farms beyond 31 December 2021 (only relevant for licences with requirements to the start date of construction, but where the construction has not started).

Furthermore, NVE has stated that they will not give any new concessions for onshore wind farms in the next few years, due to the uncertain political situation regarding onshore wind farms. (The public in general is very negative towards new onshore wind farms, and the main parties in Norwegian politics are also adjusting their views – and tend to be more negative to further exploitation of wind farms onshore). 

One of the most interesting aspects of the power industry in Norway is perhaps that it has the highest share of electricity produced from renewable sources in Europe, and the lowest emissions from the power sector.

It is also worth mentioning the very high storage capacity of Norwegian hydropower. Indeed, Norway has about half of Europe’s reservoir storage capacity – one can say that Norway is “Europe’s battery” – and the growing share of intermittent production technologies, such as wind and solar, makes it even more vital that there is flexibility available in the rest of the system.

One of the specific features of the Norwegian hydropower industry is the right of reversion to the state of licences granted to private entities after 1917. The right necessitates a shift to state ownership of waterfalls and installations when a previously granted licence expires. This change in ownership is free of charge and predicated on an aspiration to retain natural resources as a public good.

Due to legal amendments in 2008, new licences or the ownership of waterfalls and licences for the transferring of existing licensed waterfalls may only be given to public entities. The prima facie challenge of reversion is solved by transferring the production to a company that fulfils the requirements for public ownership. 

The Norwegian Energy Act is the principal law governing the structure and function of the wholesale electricity market. As of April 2021, Norway has not yet formally implemented Regulation (EU) No 1227/2011 on wholesale energy market integrity and transparency (REMIT). However, there are provisional rules in place that in practice implements most of the REMIT provisions.

The Norwegian Energy Act is based on the principle that electricity production and trading should be market-based, while grid operations are strictly regulated. The wholesale electricity market ensures effective use of resources and reasonable prices on electricity. Electricity transmission and distribution is a natural monopoly, and not subject to competition.

The Nordic power markets are closely linked, both by physical interconnectors and by physical and financial market integration, and the Nordic region forms a single electricity market divided into different price areas.

The wholesale market consists of several markets where bids are submitted and where prices are determined:

  • the day-ahead market;
  • the continuous intraday market;
  • the balancing markets;
  • the financial market.

Most of the wholesale electricity trading in Norway is done through the power exchanges, with almost all physical trading taking place through Nord Pool, and almost all financial trading taking place through Nasdaq. It is also common to enter into bilateral power purchase/sales agreements, especially for longer-term physical or financial contracts associated with specific facilities. These will often also tie into the physical and financial contracts when it comes to delivery and settlement.

The main volumes of the physical market are in the auction-based day-ahead market, whereas the continuous intraday and balancing markets are mainly used for volume adjustments up until delivery. Market participants with a balancing responsibility are required to use the day-ahead market as their primary means of balancing, and participation in the balancing market that is run by the TSO (Statnett) is mandatory.

The price is not regulated by the authorities but is a result of the supply and demand. A theoretical system price is derived from the intersection of the aggregated supply and demand curves in the day-ahead market for all of the Nordic price areas, assuming unlimited transmission capacity. The actual prices in each price area will normally differ from the system price due to capacity congestion issues.

The financial market is typically used for price hedging and to trade in long-term derivatives, and is traded both by physical market participants and purely financial players. The system price for the physical market functions as a reference price for the financial market.

Lately we have also seen the emergence of flexibility markets, that are capacity and not energy-oriented. However, these are still in a pilot phase and do not currently have any significance on the market. 

Imports and exports to other jurisdictions are both permitted and encouraged. At the end of 2020, the total installed capacity of the Norwegian power supply system was 37,732 MW, and normal annual production was 153.2 TWh (with an all-time high production in 2020 of 154.2 TWh). Norway is normally a net exporter of electricity, and currently has a transmission capacity of 6,200 MW, which equals roughly 16% of the total installed capacity.

The Norwegian power market is interconnected to the Nordic power market, both in terms of transmission capacity and market structure and venues. The Nordic day-ahead market is coupled with the day-ahead markets in much of the rest of Europe through implicit auctioning. This is, in turn, integrated into the wider European power market.

Because of Norway’s significant hydropower capacity, it has a sizeable surplus of power during periods with good hydrological conditions. When supply is abundant, Norway exports power to other countries. Denmark is a major producer of wind power and has a high production of power with low prices in windy periods. During such periods, it is profitable for other countries to import Danish power. This import enables Norwegian hydropower producers to stock up and retain water until export prices go up.

Prices on imports and exports are determined by implicit auctioning, which involves simultaneous calculation of prices and electricity flows between the different areas in the day-ahead market.

In the month of April 2021, 91.5% of electricity production in Norway came from hydropower plants, 7.4% came from wind power plants, and 1.1% came from thermal power plants (numbers in 2020 as a whole were 88%, 10% and 2%, respectively).

Norwegian power suppliers can buy guarantees of origin to market their sales as renewable; however, they may also refer to the national electricity mix.

There are no concentration limits with regard to a percentage of electricity supply controlled by any one entity in the market.

However, general competition law prohibits anti-competitive behaviour.

As of April 2021, Norway has not yet formally implemented Regulation (EU) No 1227/2011 on wholesale energy market integrity and transparency (REMIT). However, there are provisional rules in place through the Energy Act and its regulations that, in practice, implement the REMIT rules on market behaviour, including a prohibition of market manipulation and insider trading.

The RME is responsible for supervising market behaviour and transparency in the wholesale power market, in particular related to trading of physical electricity power. RME may require disclosure of all data, information and documentation necessary to carry out their supervisory function. RME may also require any illegal behaviour to immediately cease, and issue compulsory fines for violations. Violations of the Energy Act may also entail criminal liability, and could be reported to the prosecuting authority.

The RME is, in practice, a division of the Norwegian Water Resources and Energy Directorate (NVE) that also supervises the physical distribution of power, as well as the neutrality of the grid companies.

The financial power market is supervised by the FSA of Norway, and is placed under financial legislation. Norway generally incorporates the EU financial market regulations, including MiFID II and MAR. The FSA has similar powers as the RME in respect of its supervisory activities.

The Norwegian Competition Authority has general responsibility for ensuring efficient competition, including the power market, and has a wide array of powers at its disposal to enforce the Norwegian Competition Act.

The Consumer Authority supervises the rules and regulations pertaining to the sales and marketing towards consumers.

More than 98% of the electricity production in Norway comes from renewable energy sources, so the main challenge in Norway is not to reduce the emissions from the production of electricity, as such, but to reduce carbon emissions from other sources, such as industry and transport.

The Greenhouse Gas Emission Trading Act

The Greenhouse Gas Emission Trading Act (“Klimakvoteloven”) limits the emissions of greenhouse gases in a cost-effective manner by means of a system involving the duty to surrender greenhouse gas emission allowances and freely transferable emission allowances. The Act implements the emissions trading system from the EU (EU ETS) and the UN, and is one of the main instruments for reducing greenhouse gas (GHG) in Norway.

The law sets a tax on industries emitting carbon dioxide (CO₂) and applies mainly to emissions from the use of fossil energy sources. Approximately 50% of all greenhouse gas emissions in Norway are subject to the quota regime or greenhouse gas taxes.

The Climate Change Act

The Norwegian Parliament adopted the Climate Change Act (“Klimaloven”) in 2017, which includes binding emission targets for greenhouse gases by 2030 and 2050, respectively. It also requires the government to make carbon budgets. The act applies to all greenhouse gas emissions included in Norway’s contribution to the Paris Agreement of 2015.

Pursuant to the Climate Change Act, Norwegian emissions are to be reduced by 55% by 2030, and by 90–95% by 2050, compared to 1990 levels.

However, the law does not require that all cuts are made domestically. The effect of Norwegian participation in the EU Emissions Trading System will be taken into account. 

Other Instruments/Policies Implemented for the Reduction of GHGs

In addition to economic instruments such as taxes and quotas that price emissions, there are also many other instruments/policies implemented by the Norwegian authorities to reduce greenhouse gas emissions, as listed below.

  • The government public procurement law (that came into force in 2017) contains environmental provisions that will help reduce harmful environmental impact and promote climate-friendly solutions where relevant.
  • The government is planning significant investments in climate-friendly and environmental-friendly transport solutions.
  • The government has entered into urban growth agreements with several cities in Norway with incentives to ensure that the growth in (private) transport will be taken care of, primarily with the greater use of public transport, cycling and walking.
  • Norway has for several years given fully electric vehicles exemptions from taxes imposed on cars relying on fossil fuel. In 2020, this led to Norway becoming the first country in the world where the sale of fully electric cars has overtaken those powered by petrol, diesel and hybrid engines (reaching 54.3% of all cars sold). The goal is to be able to end the sales of petrol and diesel cars by 2025.
  • Norway is an early mover regarding zero-emission and low-emission solutions on ferries and ships – for instance, fuelled with hydrogen or ammonia – and has an ambitious policy for using sustainable bio-fuels.
  • Several public support schemes have been established that promote zero-emission and low-emission solutions, including several under the administration of Enova. Enova is a state-owned enterprise that manages assets in the Energy Fund and is in charge of promoting a shift to more environmentally friendly consumption and production. Enova is also responsible for the development of energy and climate technology. 
  • The Research Council of Norway (which reports to the Ministry of Education and Research) is responsible for managing the funding for energy research allocated by the ministries. The Research Council receives most of its state funding from the Ministry of Petroleum and Energy. There are several schemes and programmes under the Research Council of Norway and Innovation Norway, including “Klimasats”.
  • An investment company with state funds, Nysnø, has also been established, with the purpose of helping to reduce greenhouse gas emissions.
  • The government has introduced a ban on the use of mineral oil for heating buildings from 2020.

Natural Gas and Reduction of Emissions from Industrial Facilities

Even though natural gas is not used to produce electricity (other than on the oil and gas-producing installations themselves) and is hardly used at all as energy for heating, cooking, etc, in Norway, the income from the oil and gas industry is vital for the Norwegian industry. The Norwegian government is therefore promoting the use of natural gas in ways that are not leading to carbon emissions, but instead enhance the green shift.

One such possibility is using the natural gas for the production of decarbonised (“blue”) hydrogen, that can be used as emission-free fuel – for instance, within the heavy transport industry (ships, ferries and trucks).

A prerequisite for being able to market emission-free hydrogen from natural gas is, however, to have a system for the capture and storage of the CO₂ that is released through the production process.

The same challenge exists for reducing the carbon emissions from industrial facilities that releases CO₂ in its ordinary process – for instance, cement production, steel production and waste-to-energy facilities.

The government’s answer to these challenges is to facilitate (and to a large degree fund) a full-value chain for the capture and storage of CO₂ in Norway.

Carbon Capture and Storage (CCS) – Laws and Regulations

Carbon capture and storage (CCS) is a key element in the Norwegian government’s policy to enable carbon neutrality by 2050. Laws and regulations related to CO₂ management are:

  • Regulations to the Petroleum Activities Act;
  • Regulations on the utilisation of subsea reservoirs on the continental shelf for the storage of CO₂ and on the transport of CO₂ on the continental shelf; and
  • Regulations on documentation when storing CO₂ on the continental shelf.

The Norwegian Longship Project

The Norwegian government is putting considerable weight (and money) into facilitating a full-value chain for CCS in Norway, and the Norwegian Longship CCS project is considered a milestone in its industry and climate efforts.

The Longship project consist of one (or possibly two) carbon capture facilities, a transport solution and an underground storage solution in western Norway.

The transport and storage part of the project is carried out by a joint venture company, Northern Lights, that will store the CO₂ in subsea reservoirs on the continental shelf in the North Sea.

ESA has approved the state-aid part of the funding, and the Northern Lights partners are currently discussing concrete deliveries of CO₂ from several companies around the North Sea, both Norwegian and foreign, within several industrial sectors – for example, waste-to-energy, steel, refineries, cement production and bio-mass/bio-fuel).

See 3.1 Principal Climate Change Laws and/or Policies.

See 3.1 Principal Climate Change Laws and/or Policies.

The principal laws that govern the construction and operation of generation facilities are:

  • the Waterfall Rights Act (“Vannfallsrettighetsloven”);
  • the Energy Act (“Energiloven”);
  • the Watercourse Regulation Act (“Vassdragsregulerings loven”);
  • the Planning and Building Act (“Plan- og bygningsloven”);
  • the Water Resources Act (“Vannressursloven”);
  • the Expropriation Act (“Ekspropriasjonsloven”); and
  • the Offshore Energy Act (“Havenergilova”).

Pursuant to the Waterfall Rights Act, the developer of hydropower must obtain ownership rights to waterfalls prior to exploiting the water for electricity purposes.

As far as large hydropower projects are concerned (more than 4,000 natural horsepower), this act requires that only public entities obtain such rights. These entities may be state-owned enterprises, municipalities or county authorities, as well as companies where (Norwegian) public bodies make up at least two-thirds of the capital and the votes.

Private actors may thus only account for one-third of ownership in such companies. The public ownership requirement does not apply to smaller hydropower projects, so private actors may own and operate hydropower projects of a lesser magnitude.

The same applies to wind and solar power projects, which private actors may own and operate, regardless of the dimension of the project. 

The purpose of the Energy Act is to ensure that energy is generated, converted, transmitted, traded, distributed and used rationally. The Act constitutes a framework for electricity generation and trading competition. It also states that the building and operating of power grids is a monopoly and sets forth the regulation of grid companies. 

The developer of onshore wind farms must obtain rights to build and produce power pursuant to the Energy Act. While hydropower represents the backbone of renewable energy production, onshore wind power has been the fastest growing renewable energy source in Norway. The rules applicable to the development and exploitation of onshore wind power are also less rigid than those that relate to large hydropower projects. As the requirement for public ownership does not apply to wind power, the development of wind farms has been particularly conducive to private investment. The Offshore Energy Act provides the legal basis for the development of offshore renewable energy production. The Act confirms the Norwegian state’s right to utilise offshore energy resources and applies to Norway’s territorial waters outside the baselines and to the continental shelf.

A licence is required for electricity generation, conversion and transmission in areas covered by the Act. Licences can only be obtained after the central government authorities have carried out a strategic environmental assessment and decided to open specific areas for licence applications.

The Watercourse Regulation Act regulates flows in rivers and transfers between river systems in conjunction with power generation, and outlines the requirements for obtaining licences for such regulation. Pursuant to the Watercourse Regulations Act, the licences include a delimitation of the highest and lowest permitted water levels in reservoirs, the requirement of establishing a business development fund in a municipality where the development takes place, and the rules for reservoir drawdown. The licences may also contain conditions pertaining to licence fees and mandatory sales of power. 

The purpose of the Planning and Building Act is to promote sustainable development in the best interests of individuals, society and future generations. It does not apply to marine pipelines for the transport of petroleum, and only certain chapters of the Act apply to installations for the transmission or conversion of electric power.

The Water Resources Act regulates the abstraction of water for fish farms and the extraction of deposits. It also applies to small-scale power projects. The licences given pursuant to the Act include conditions to guarantee compensation for or mitigate damage.

The Norwegian Water Resources and Energy Directorate is in charge of processing applications for licences for the construction of power plants, dams and other installations in the watercourses, major power lines and other energy installations that require permission pursuant to the Offshore Energy Act, the Onshore Energy Act and/or the Water Course Act.

The Directorate issues licences to the companies applying for them. If granted, the companies obtain a right to build and operate power installations and accessories as specified in the licence. The licence typically includes standard conditions and rules of operation, which reflect the need to consider various interests. As the exploitation of renewable resources has an impact on the environment, the Directorate needs to ensure that the benefits of the proposed project are greater than the disadvantages, prior to granting the licence. The Directorate’s supervisory department ensures adherence to the conditions and rules of operation after approval of the licence. 

The steps in a regulatory process may be summarised as follows:

  • the company notifies the Directorate about the project and includes a thorough description of the project’s impact on the environment – this is typically done through an Environmental Impact Assessment (EIA);
  • a public hearing on the notification and the EIA programme is held;
  • the EIA programme is approved or declined;
  • an application for a licence is filed with the Directorate together with the EIA;
  • a public hearing on the licence application and EIA is held; and
  • the Directorate makes its decision.

The decision made by the Directorate can be appealed to the Ministry of Petroleum and Energy, but the appellant must have a legal interest in doing so.

In large hydropower projects, the project must be approved by the King in Council (the Cabinet, in effect). 

For smaller projects with only marginal environmental impact, the process is subject to simplified procedures.

Approvals granted pursuant to the Industrial Licensing Act on hydroelectric power typically include conditions on licence fees and mandatory sales of power to the state and municipalities in which the waterfalls are located. 

The licences pursuant to the Watercourse Regulations Act typically include a delimitation of the highest and lowest permitted water levels in reservoirs, the requirement for establishing a business development fund in a municipality where a development takes place, and the rules for reservoir drawdown.

The licence under the Waterfall Rights Act also states conditions and rules of operation. The supervision department in the Directorate follows up and supervises the fulfilment of the conditions.

The licence under the Onshore/Offshore Energy Act also states conditions and rules of operation. The supervision department in the Directorate follows up and supervises the fulfilment of the conditions.

In order to construct and operate a generation facility, the developer must apply for the expropriation of property rights pursuant to the Expropriation Act. Depending on the circumstances, relevant provisions in the Cultural Heritage Act, the Pollution Control Act and the Reindeer Husbandry Act must be taken into consideration in the licensing process.

Compensation is due to the owner of the relinquished property. The owner is also due compensation for any damage or inconvenience brought upon the remaining properties. Pursuant to the Expropriation Compensation Act, the reparation is determined based on the selling price or the service value, whichever is higher. 

Facilities relating to the production, transmission and distribution of electrical power may not be decommissioned without prior approval from the Norwegian Water Resources and Energy Directorate.

Should the holder of the licence wish to terminate the operation of the facility during the licence period, they must apply to the Directorate for a decommission approval. If the holder wants to prolong the licence period or terminate the operation, they must file an application with the Directorate one year ahead of the licence’s expiration. 

In the event of decommissioning, the holder of the licence is obliged to remove the facility and restore the landscape to its original state. 

The Norwegian grid system consists of three levels: the central transmission level and two levels of distribution – the regional level and the local distribution level. Many of the relevant laws and regulations apply to all three levels. In addition, the terms and conditions to licences for constructing and operating the grid system are enforced equally on all levels. 

The principal laws that govern the construction and operation of transmission lines are the Energy Act and the Offshore Energy Act, the purpose of which is to ensure that energy is generated, converted, transmitted, traded, distributed and used rationally. The Energy Act constitutes a framework for electricity generation and trading competition. It also states that building and operating power grids is a monopoly and sets forth the regulation of grid companies. 

A construction and operating licence is required to construct, own and operate power lines. A licence to build and operate transmission lines must be approved by the King in Council. 

The licensing system aims to ensure a uniform practice for the construction and operation of electrical installations. The goal is also to assess and alleviate the potential impacts of these installations. Thus, socio-economic considerations and various public and private interests are taken into account during the licensing procedures, as well as environmental impacts. 

Approvals to construct and operate a transmission line and associated facilities are typically supplemented with various requirements, including applying for renewal of the licence within a set time before its expiration, initiating the operation of the lines by the end of a set period, being acquainted with the relevant rules and regulations, and being responsible for decommissioning the facilities subsequent to such measure being granted by the Directorate.

There are also requirements devised to prevent or limit any detriment to the natural environment and cultural heritage. If necessary due to fundamental interests, the terms and conditions may be supplemented at a later stage. All terms and conditions serve to fulfil the purpose of the laws on which the granting of licences is predicated. It is the Directorate’s responsibility to monitor the adherence to the terms and conditions of the licence under the supervision of the Ministry of Oil and Energy. 

Statnett SF is the only TSO and therefore (from 1 January 2021) the only legal person that is allowed to own and operate transmission lines and associated facilities in Norway. Hence, the construction and operation of the transmission grid constitutes a natural monopoly. The proponent for the construction and operation of a transmission line will thus have eminent domain, condemnation or expropriation rights in the area to which it earns access.

In order to obtain this exclusive right, an application must be filed with the Ministry of Petroleum and Energy, which then decides whether the licence is granted. The rights to the surface of land are obtained through expropriation. 

The owner of the property is to be compensated for the relinquishment of the building and operation of transmission lines, as well as for any damage or inconvenience brought upon any remaining properties. Pursuant to the Expropriation Compensation Act, the reparation is determined based on the selling price or service value, whichever is higher.

Transmission entities have an exclusive right to construct and operate transmission facilities within a defined territory; see 5.1.4 Proponent's Domain, Condemnation or Expropriation Rights

The most important laws and regulations governing the provision of transmission service and the regulation of transmission charges and terms of service, are as follows:

  • the Energy Act (“Energiloven”);
  • the Energy Act Regulation (“Energilovforskriften”);
  • the Regulation on grid regulation and the energy market (“Forskrift om nettregulering og energimarkedet”);
  • the Regulations regarding Environmental Impact Assessments (“Forskrift om konsekvensutredninger”);
  • the Regulations of 11 March 1999 concerning financial and technical reporting, permitted income for network operations and transmission tariffs (“Forskrift om kontroll av nettvirksomhet”).

As the building and operation of transmission lines are a natural monopoly, the Directorate decides on an annual income cap for each company operating them. The income is supposed to cover the costs of operation while generating a reasonable profit on investments. 

All grid services must be offered at non-discriminatory conditions and objective point tariffs.

As grid companies are monopoly companies, the authorities regulate their revenues. Consequently, the Directorate decides on a revenue cap for each grid company every year. The grid company must set its tariffs so that net earnings from grid operations over time do not exceed the permitted level. 

It is generally required that grid tariffs are objective and non-discriminatory, as well as designed and differentiated based on relevant grid conditions. As far as possible, the tariffs should be fashioned to provide long-term signals that encourage efficient use and development of the grid.

The tariffs for consumption should cover a share of the costs that accumulate at the relevant grid level and higher levels. The tariffs for consumption vary between consumers connected to the distribution grid and consumers directly connected to the central grid. The prices may also fluctuate between different companies.

The Directorate for Water Resources and Energy is responsible for the inspection and enforcement of grid operations, and may issue orders to ensure compliance with regulations and licensing terms. All grid services must be offered at non-discriminatory conditions and objective point tariffs. Due to being a monopoly, the grid companies on all levels are obliged to provide services to all consumers within the geographical area covered by the licence. 

The Norwegian grid system consists of three levels: the central transmission level and two levels of distribution – the regional level and the local distribution level. Many of the relevant laws and regulations apply to all three levels. In addition, terms and conditions to licences for constructing and operating the grid system are enforced equally on all levels. 

The principal law that governs the construction and operation of distribution lines is the Energy Act, alongside the Planning and Building Act.

The purpose of the Energy Act is to ensure that energy is generated, converted, transmitted, traded, distributed and used rationally. The Act constitutes a framework for electricity generation and trading competition. It also states that building and operating power grids is a monopoly and sets forth the regulation of grid companies. 

The purpose of the Planning and Building Act is to promote sustainable development in the best interests of individuals, society and future generations. It does not apply to marine pipelines for the transport of petroleum, and only certain chapters of the Act apply to installations for the transmission or conversion of electric power.

The construction and operation of distribution lines necessitate an approval to build and operate them. The local area licence is needed to construct, own and operate power lines and electrical installations for the distribution of electricity carrying a voltage of 22 kV or less. The local area licence permits the holder to build, own and operate necessary lines within that geographical area. 

The application for licences must be filed with the Norwegian Directorate for Water Resources and Energy. However, if the projects are of a certain magnitude, they must be approved by the government. 

The construction and operation of electric distribution facilities necessitate prior approval in the form of two potential licences. The local area licence is necessary to construct, own and operate power lines and electrical installations for the distribution of electricity carrying a voltage of 22 kV or less. The local area licence obviates applications for each individual installation, instead permitting its holder to build, own and operate necessary lines within that geographical area. 

The construction and operating licence is required in order to construct, own and operate facilities that are not covered by the local area licence. However, this type of licence is only needed where the producer of power wishes to be connected to the distribution facilities and the holder of the local area licence does not engage in any construction of the sort. The construction and operating licence necessitates applications for each individual installation. The installations may include facilities associated with both wind farms and hydropower plants. 

The application for a licence must be filed with the Norwegian Directorate for Water Resources and Energy, but the government must approve projects of a certain magnitude. 

The Directorate grants both the local area licence and the construction and operating licence needed prior to the construction and operation of distribution facilities. The licensing system aims to ensure a uniform practice for the construction and operation of all electrical installations, and to assess and alleviate the potential impact of these installations. Thus, socio-economic considerations, various public and private interests, as well as environmental impacts are taken into account during the licensing procedures.

See 5.1.3 Terms and Conditions Imposed in Approvals to Construct and Operate Transmission Facilities.

See 5.1.4 Proponent's Eminent Domain, Condemnation or Expropriation Rights.

See 5.1.4 Proponent's Eminent Domain, Condemnation or Expropriation Rights.

See 5.2.1 Principal Laws Governing the Provision of Transmission Service, Regulation of Transmission Charges and Terms of Service.

See 5.2.2 Establishment of Transmission Charges and Terms of Service.

Advokatfirmaet Hjort DA

Akersgata 51
N-0180 Oslo
Norway

+47 22 47 18 00

+47 22 47 18 18

advokatfirmaet@hjort.no www.hjort.no
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Trends and Developments


Authors



Haavind is one of Norway’s leading law firms, delivering strategic legal advice and services in all aspects of commercial law. Haavind is a full-service law firm, with several of the largest companies in Norway, as well as public sector, as customers. The firm is a natural choice for organisations undergoing change and digital transformation. It works systematically to stay ahead of the game, by understanding trends and new technology and translating this into opportunities for its customers. Haavind's lawyers find great motivation in finding good solutions and working hard to ensure relevance, quality and efficiency in their deliveries. The firm has experience in advising and working with organisations actively contributing to sustainable development. Haavind is legal partner to several large, international companies with a strong focus on ESG and the UN’s sustainability goals.

Introduction

The Norwegian power sector is, in general, highly regulated. This applies in particular for hydropower activity, which has more than 100 years of history and still forms the backbone of the country's power system. Overall, Norway has stable legal frameworks, this clearly being one of the reasons why there have been many foreign investments within the Norwegian power sector over the past years.

For the most part, foreign investors can invest in the Norwegian power sector without specific restrictions. This comprises investments in wind power, small-scale hydropower, grid companies, district heating and other infrastructure relating to the power sector. The main exception to this is related to large hydropower (the threshold being approximately 40 GWh of production/year) where non-public entities (including foreign entities) are not allowed to invest in and own more than one-third of companies owning such assets. Public entities, being allowed to own such assets, are defined as entities owned and controlled by public authorities and/or undertakings.

One important aspect of Norwegian hydropower (and the Norwegian power system) is that to a large extent it represents flexible production as it can be stored using water reservoirs. More than 75% of Norwegian hydropower production is flexible through the use of reservoirs, this representing half of Europe’s reservoir capacity. This is a perfect match to balance the increasing amount of non-flexible production such as wind power and solar power.

Although Norwegian power production is largely dominated by hydropower, onshore wind is growing quickly and is likely to increase to 15% of the total production during 2021. At the same time, this growth has led to protests from different groups that are concerned about the impact on nature, the visual effect of wind turbines on the landscape, etc. The protests have led to changes in the legislation related to onshore wind power, as detailed below.

The Recent White Paper on Norway's Energy Resources

The Norwegian government’s recent (June 2021) issuance of the White Paper on the long-term value creation from Norwegian energy resources included, for the first time, both the renewables sector and the oil and gas sector. The White Paper focuses on the following four goals in the years to come.

Economic growth and job creation

Norway’s renewable energy resources shall be put to use in Norway, enabling further economic growth and jobs. This includes the development of renewable energy production at sea (offshore wind), as well as hydrogen and carbon capture and storage (CCS).

Further electrification

Although Norway is already electrified to a large extent, the government presents in its White Paper a strategy for the further electrification of Norway (onshore and offshore), focusing in particular on the need to strengthen and co-ordinate the power grid to be able to meet the demand following further electrification. Related to this, the government has appointed a panel of experts that will assess the further development of the Norwegian power grid. One important task for the expert panel will be to propose measures to reduce the time spent in the licensing process for new grid facilities. 

Establishment of new, profitable industries/technologies within the sector

The White Paper emphasises the importance of developing new and profitable industries based on existing industries, including oil and gas, to help Norway’s transition towards a low-emission society. Examples of such new industries include the production and use of hydrogen, offshore wind power and CCS/CCU, as well as battery production and other activities where access to renewable energy represents a competitive advantage. The government aims to facilitate this development based on efficient and predictable framework conditions.

Further development of the oil and gas sector within the framework of climate change goals

The White Paper points out that the Norwegian oil and gas industry currently faces major challenges as a result of maturing fields on the Norwegian continental shelf and increasing demands for lower emissions. However, it is emphasised by the government that the oil and gas sector will remain a significant factor in the Norwegian economy in the years to come, although not on the same scale as today. The use of expertise and technologies within today’s oil and gas sector to develop new “green” industries and technologies is also an important aim for the government.

Comprising both the renewables sector and the oil and gas sector, this White Paper has the potential to become one of the most important political documents within the energy sector (and related sectors) for decades to come.

Onshore Wind

Increase in disputes brought before the courts

Within the onshore wind sector, there has been an increasing need to handle frequent litigation triggered by a growing political opposition to wind power. In our experience, however, there have been few actual delays to wind power developments caused by legal action.

Nonetheless, the battle over the validity of wind power licences has made its way into the courtroom. It is possible that we are seeing the same growing tendency for rights and validity issues handled in Norwegian courts as has been seen in other countries. Added to the increased opposition to wind power, there was a sharp increase in the number of validity disputes in 2019 and 2020. Several cases have reached the appellate courts and also the Supreme Court.

Despite an apparent increase in the willingness to fight energy projects in court, a majority of the disputes are resolved amicably.

Review of the licensing system

The increasing level of conflict relating to onshore wind farm projects has resulted in a pause in the licensing of new projects since April 2019, combined with a broad request for amendments to the licensing system. As a response to the latter, the government presented before the Norwegian Parliament in June 2020 a White Paper with proposals for regulatory amendments to comprise all future applications relating to onshore wind power projects.

The White Paper was handled by Parliament in December 2020, resulting in a request to the government to include shorter deadlines for commencement of the construction works and commissioning, the inclusion of height and distance restrictions on wind turbines in the licences, as well as measures to ensure increased local and regional involvement in the licensing process. Parliament also included a request to the government to consider changes to the taxation of the wind power sector (see below, "Amendments to the taxation of wind power"), and also a request to consider how the licensing process according to the Norwegian Energy Act can further be harmonised with the process following from the Norwegian Planning and Building Act, the latter request interpreted as a general aim for Parliament to increase the influence of local municipalities in the licensing process.

In the White Paper on Norway’s energy resources issued in June 2021, the government confirms that the above amendments to the regulatory framework are being assessed and are in process and that the licensing of onshore wind power projects will be resumed based on the amended legal framework. However, and at the same time, the government indicates that a proposal for specific amendments to the legal framework will not be passed on to Parliament before spring 2022, at the earliest.

Amendments to the taxation of wind power

The Norwegian government has announced that it aims to implement a moderate production tax on onshore wind power plants as from 2022. The production tax will be paid to the Norwegian state, but it is the intention of the government to route this income to the municipalities hosting the wind farms. The proposal comprises both existing and new wind power plants. 

The proposal is an answer to the requests from many stakeholders’ (including the wind power industry itself) to route a higher share of the tax income from the wind power business towards the hosting municipalities, which it is believed will help increase local acceptance for the projects.

The government will consider the details of the new tax as part of the state Budget for 2022.

Offshore Wind

In terms of alternative energy, offshore wind is and will continue to be the main subject of attention in Norway. The new regulations to the Ocean Energy Act, effective from 1 January 2021, allows companies to apply for a licence to develop projects in the appointed areas of Utsira North and Southern North Sea II. In June 2021, the Norwegian government presented the much-anticipated consultation papers on proposed amendments to the Ocean Energy Act and Regulations, and guidelines for the offshore wind licensing process, all of which provide central detailing of the offshore wind regulatory regime. We note with particular interest that the government has announced the opening of additional licensing areas, and that the principal rule for awarding licences to bottom-fixed installations will follow an auction-based system, this being particularly relevant for South North Sea II. A qualitative award system may also be utilised, this being particularly relevant for Utsira North as the area is suitable for floating technology.

The government also aims to appoint the current transmission system operator (TSO) for the Norwegian mainland, Statnett SF, as the TSO also for a future North Sea Grid. The government has also announced that grid costs related to such a North Sea Grid are to be carried by licensees, and are not to be carried by onshore grid customers.

Whilst the suggested amendments represent a regulatory clarification, there remain key questions to be addressed before we can expect any real offtake within this budding industry. In particular, the financial framework remains contentious and is a central point requiring clarification for stakeholders. The proposal for amendments does, nonetheless, state that the government is working on amendments to the tax regime in order to ensure tax liability to Norway from income derived from production of wind power on the Norwegian continental shelf.

In spite of these structural uncertainties, a number of collaborative structures have already been formed, and are expected to be put in place, in order to compete for the available licences for offshore wind on the Norwegian continental shelf.

Hydropower

Even though the vast majority of hydropower potential has already been utilised, the Norwegian Water Resources and Energy Directorate (NVE) recently calculated the remaining hydropower potential to 23 TWh. Although having in mind that the potential for new establishments is present, upgrading of already existing hydropower plants will become increasingly important, it being crucial to not only increase hydropower production in the mix but also to maintain the level of production capacity in existing plants.

To facilitate this development, the Norwegian government has introduced amendments to the hydropower taxation regime that reallocates the resource tax into taxation targeting cash flow, by allowing hydropower producers to immediately deduct investments costs from the resource income taxation basis. This will secure the producers a significantly improved liquidity in the investment phase, but the taxation as a whole is intended to be neutral. Amendments to the legislative regime have therefore recently been suggested (May 2021) to make available necessary alignment between the resource tax and the company tax.

Adjustments in the tax regime for large hydropower producers are predicted to positively affect the development, and will hopefully contribute to resolving a situation that for several years has limited companies’ financial incentives to carry out upgrades that are deemed necessary and desirable in the public interest. Recent discussions on the role of wind-generated electricity in the energy mix have also led to raising the issue of regulatory changes to optimise the utilisation of hydropower resources available.

Lately, another major issue relating to hydropower in Norway has been the discussion on impacts of the taxonomy forming part of the EU's Green Deal. In the initial discussion of consequences for the hydropower business, concerns were raised in relation to the risk of Norwegian hydropower being classified as non-sustainable and therefore less eligible for access to capital – partly due to criteria being set based on experience from hydropower development in other countries that are not necessarily relevant to how this business is conducted in Norway.

A key factor here is the link to the EU’s Water Framework Directive, which will contribute to improving the environmental conditions of watercourses throughout Europe. Following a consultation process in which Norway was awarded the opportunity to comment on the impact of suggested criteria for categorisation, the criteria, although far from perfect, now seem to be at a level that Norwegian hydropower players overall find acceptable.

Grid

Further unbundling requirements

As of 1 January 2021, the requirements of legal unbundling on DSOs apply to all entities and functional unbundling applies, after a contentious political debate, to DSOs with more than 10,000 grid customers. The Ministry of Petroleum and Energy has further detailed the requirements of legal and functional unbundling, such as composition of boards of directors, use of trade marks and marketing and sale of excess capacity.

The requirements will force affected grid companies to undergo significant reorganisation, and it is expected that it will lead to further and considerable consolidation within this part of the power sector.

Grid tariffs

The Norwegian Water Resources and Energy Directorate (NVE) released a proposal on a new grid tariff model in 2020, which incentivises customers to reduce peak loads. The Norwegian government has now passed a new grid tariff model, based on NVE’s proposition, that will be in effect from 1 January 2022.

The new grid tariff model aims to facilitate a more effective use of the grid, and a more just distribution of the costs between the customers. According to the new tariff model, customers with a power consumption of less than 100,000 kWh/year shall have their grid tariff differentiated based on peak load consumption, in such a manner that customers with a higher peak load consumption pay a higher grid tariff than those with a lower peak load consumption. Customers with a consumption above 100,000 kWh/year are still able to have a separately fixed grid tariff, in accordance with the current grid tariff scheme.

The new grid tariff model will incentivise effective use of the grid and – through new technology, batteries, etc – allow for a more flexible use of the grid, also leading to a reduction of the requirement of investments in new grid capacity.

Interconnectors

With its hydropower reservoirs, Norway manages approximately half of Europe's regulation capacity. As the energy mix becomes increasingly non-regulated with the additions from wind and solar power, the need for (and the commercial aspect of) regulated hydropower is ever more important.

With existing and forthcoming interconnectors between Norway, other Nordic countries and the UK, Norway exchanges both power and regulation capacity. Given this structural position, it has been postulated that Norway can act as "Europe's green battery" – this to the excitement of some stakeholders in Norway and the concern of others. As seen with the proposed North Connect project between Norway and Scotland (capacity of 1400 MW), the export of power remains a hotly contested political issue and the government has thus far chosen to put the application on hold. One of the key issues behind the political debate is the idea that Norway's power-intensive industry and consumers at large benefit from Norway's low electricity prices, as compared to other European countries.

The capacity in the interconnectors is currently approximately 6,200 MW (approximately 20% of Norway's installed production capacity). In March 2021, the new interconnector to Germany (NordLink, with a capacity of 1400 MW) was completed and commissioned. The new interconnector to the UK (North Sea Link, with a capacity of 1,400 MW) was completed in 2021 and is now under testing and edging towards full commissioning. With their respective capacities, they represent a 45% increase in Norway’s capacity to exchange power.

Statnett SF – the current Norwegian transmission system operator for the Norwegian mainland – has, after some political back-and-forth, been granted the exclusive right to own and operate all interconnectors, with some exemptions as regard to the North Connect project (currently in a licensing process) and as regard to some aspects related to the future North Sea Grid; see above, 'Offshore Wind'.

New Technologies and Innovation

Further digitalisation of the power sector

New digital solutions for the power sector are continuously contributing to more efficient operations and system maintenance, assured power supply and better preparedness. Increased digitalisation and the collection of higher-quality data will also provide a more precise evidential basis for investment decisions and allow for the automation of a number of decision-making processes. This also creates a need for new regulations, business models and customer adaption. We see this exemplified by the implementation of smart metering, where new equipment has been installed in 97% of all metering points within Norway.

Hydrogen

Hydrogen, and green hydrogen in particular, is increasingly being put on the agenda in Norway. In 2020 the government released its new national hydrogen strategy, focusing on subsidising new hydrogen technology and initiatives. In the issuance of the above-mentioned White Paper in June 2021, the government also announced its roadmap for hydrogen.

In the short term (by 2025), the government, in co-operation with private stakeholders, wishes to:

  • encourage the establishment of five hydrogen maritime hubs;
  • establish one to two industrial production projects; and
  • establish between five to ten pilot projects for the development and demonstration of new and more cost-effective hydrogen solutions and technologies.

In the medium term (by 2030) the government’s ambition is that hydrogen will be established as a real alternative within the maritime sector, with prospects of market-based developments. By 2050 the goal is to have established a market for the production and consumption of hydrogen.

In 2021, the revised national Budget doubled the allocated funds for this purpose, totalling NOK200 million. This remains, however, a modest figure next to Germany’s EUR9 billion for hydrogen development. Several stakeholders have called for a more aggressive and broad-ranging governmental initiative, both from a commercial and an environmental perspective. 

With the EU’s environmental goals towards zero carbon-emissions and its focus on hydrogen, Norway’s structural advantage within green hydrogen based on renewable energy production may be particularly beneficial. However, the development of green hydrogen irrefutably requires significant infrastructural and technological investments.

Norway is particularly looking at how to utilise hydrogen to cut the country’s second-largest emission producer, the transport sector. It has set a goal to halve the current emissions from the transport sector and marine transport by 2030, and hydrogen will be important in achieving this goal.

CCS

The Norwegian government published a White Paper on 21 September 2020 regarding the so-called “Longship project”, and the government’s carbon capture and storage efforts (CCS) are focused around this project. Longship is a full-scale demonstration project on CCS, developed by the joint venture Northern Lights JV DA (between the companies Equinor, Shell and Total) and Norcem’s cement factory in Brevik in the Porsgrunn municipality. The project encompasses carbon capture from Norcem’s cement factory (400,000 tons of CO₂ per year), and also potential carbon capture from Fortum Oslo Varme’s waste-to-energy plant in Oslo (400,000 tons of CO₂ per year).

Northern Lights is responsible for the transport and storage part of the Longship project, which utilises ships for transport of liquid CO₂, a reception terminal in Øygarden municipality on the west coast of Norway, and a pipeline to a storage formation under the seabed where CO₂ will be injected. Northern Lights has received state funding for the first project phase with a planned transportation and storage capacity of 1.5 million tons of CO₂ per year. Northern Lights may sell the remaining transportation and storage capacity to other companies involved in carbon capture, and it is the Norwegian government’s clear intention that European companies utilise the Longship transportation infrastructure for CCS in the future.   

The Norwegian government has no further planned CCS projects other than Longship and seems set to leave it up to the market to develop any further CCS projects. CCS is not economically profitable without external or governmental funding, and it is uncertain whether we will see further investments in CCS projects in Norway following the Longship project. According to the ICCP, to restrict global warming in accordance with the Paris Agreement, it is vital that – in addition to conventional CCS – Norway invests in negative carbon emissions, such as bio-energy CCS. However, the Norwegian government has not formed a strategy on negative emissions and bio-energy CCS.

Concluding Remarks

The Norwegian energy sector is developing fast, with increasingly blurred lines between the traditional power/electricity sector and the oil and gas sector. This development is driven by strong political goals of further electrification, including of oil and gas installations, and also of developing new and profitable industries such as (floating) offshore wind, hydrogen and CCS as part of a necessary transition of Norway’s oil and gas industry. This development is further strengthened by an increasing opposition against onshore power projects, such as onshore wind power. Norway has considerable ambitions within these new industries, indicating that the development that we see today will be further strengthened in the years to come.     

Haavind Advokatfirmaet

Bygdøy allé 2
N-0257 Oslo
Norway

00 47 22 43 30 00

post@haavind.no www.haavind.no/en/
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Law and Practice

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Advokatfirmaet Hjort DA was established in 1893, and has since become a well-known and leading litigation firm in Norway. Hjort has the structure and capacity to engage in all of the central legal areas, with a solid competency, amongst others within the renewable energy industry, in corporate legal assistance and dispute resolution. The firm's highly acclaimed judicial competency, combined with a corporate understanding and commercial appeal, are the reasons why it is considered to be an unparalleled contributing partner in regard to important and demanding legal cases.

Trends and Development

Authors



Haavind is one of Norway’s leading law firms, delivering strategic legal advice and services in all aspects of commercial law. Haavind is a full-service law firm, with several of the largest companies in Norway, as well as public sector, as customers. The firm is a natural choice for organisations undergoing change and digital transformation. It works systematically to stay ahead of the game, by understanding trends and new technology and translating this into opportunities for its customers. Haavind's lawyers find great motivation in finding good solutions and working hard to ensure relevance, quality and efficiency in their deliveries. The firm has experience in advising and working with organisations actively contributing to sustainable development. Haavind is legal partner to several large, international companies with a strong focus on ESG and the UN’s sustainability goals.

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