Analysis by GlobalData say that Norway’s plan to invest $384.5 million as a green transition package will help the country on economic and environmental fronts.

Environmental support would enable the country to achieve the objective of the Paris Climate Agreement to limit global temperature increases to less than two degrees by 2050. Alternatively, the economic drive will help the country improve the economy that has been stagnating during the pandemic

“The package’s objective is to bolster the green transition and use this as a mechanism to stimulate economic activities beyond the pandemic. Implementing the hydrogen strategy would likely help in decarbonizing the economy and improve Norway’s ability to reach its climate goals.

“Countries worldwide strive to accelerate the development and use of hydrogen technology to tackle environmental concerns and enhance energy security. While hydrogen can be produced through carbon capture and storage technologies, these processes emit more emissions and cannot be considered clean.

“However, formulating a cost-effective and well-regulated transition will be a complex issue for the Norwegian government as the cost of producing hydrogen from renewable energy sources is currently expensive. To achieve the environmental target within the deadline, the government would need to increase the number of hydrogen pilot and demonstration projects to scale up to reduce costs; and expand hydrogen use to new sectoral applications.”

Somik Das, senior power analyst at GlobalData.