The Norwegian government intends 30 GW of offshore wind capacity to be operational in its waters by 2040. This aim was announced on 11 May and is intended to promote hydrogen exports by Europe’s largest oil and natural gas producer as well as the electrification of Norway’s economy.
In a speech on 11 May, Prime Minister Jonas Gahr Stre announced the target: “We need additional power for the planned industries in Norway, including battery manufacture, hydrogen generation, and investment in new aluminum developments.”
“When we engage with Norwegian industry, everyone we see discusses replacing natural gas with hydrogen and decreasing greenhouse gas emissions. This is the direct key to attaining those objectives “he added.
Expansion of Norway’s offshore wind goals was included in the Hurdal Platform, which outlined the coalition’s objectives in October. In addition to pledging to participate in the offshore wind race, the platform stated that Norwegian emissions will be reduced by 55 percent by 2030 compared to 1990, the Guarantees of Origin system will be eliminated, and Norway will continue its quest for new oil and gas.
However, the coalition failed to replicate the actions of its North Sea neighbors and set interim targets, which, according to industry sources, would have provided even greater reassurance to developers and supply chain companies regarding the investment outlook at a time when countries around the world are announcing offshore wind targets.
The administration of Stre was previously criticized by industry participants for failing to arrange lease auctions and not aiming high enough for offshore lands that offer constant, strong winds.
Local support was less competent. 11 May. Norwegian Offshore Wind (NOW) stated that the objective was “totally in line” with what its members desired and was “attainable.”
“We are ecstatic to finally have a roadmap for offshore wind in Norway. We provide the predictability the industry requires to launch and make investments “said NOW Manager Arvid Nesse.
Statkraft, which claims to be Europe’s largest renewable energy provider, told Net-Zero Business Daily by S&P Global Commodity Insights on 11 May that it was “extremely delighted” with what it dubbed a “ambitious but achievable goal.”
The government’s plan was also supported by Norway’s largest oil and gas firm, Equinor, a pioneer in offshore wind energy. A representative told Net-Zero Business Daily that it was a welcome development. “We feel there is a big potential for growing offshore wind in Norway,” the spokesman said, adding, “It is necessary to get started in order to realize the potential, and we eagerly await the precise criteria for the two initial initiatives, Srlige Nordsjen II and Utsira Nord.”
doubling the sector of generation
With the addition of 30 GW of capacity, the Norwegian offshore wind sector will have the same scale as the country’s current power sector.
The statement “makes this day a milestone in Norwegian economic and energy history,” Stre said in a speech announcing the objective, emphasizing that Norway had offshore wind prospects comparable to the rest of Europe combined.
In a statement announcing the objective, he continued, “With attractive marine areas, personnel with world-leading technology competence, and solid cooperation between the state and business, we all have the conditions for success.”
In addition, he stated that the possibility for driving green hydrogen generation with offshore wind is an equally significant opportunity, one that was inconceivable less than a decade ago. He stated, “This was almost science fiction five years ago.”
The government of Stre anticipates power exports from Norwegian waters to both the Norwegian shore and the rest of Europe via interconnectors. The government also anticipates that the energy will be utilized to electrify the oil and gas industry, the country’s economic engine.
Currently, all of the Nordic nation’s energy needs are met by its existing hydroelectric power producing fleet, which is a boon for energy consumers but a significant obstacle for project developers.
S&P Global Commodity Insights Principal Research Analyst Andrei Utkin stated on 11 May that it is very difficult to add generation in Norway profitably due to the fact that demand is not likely to increase much without a major industrial revolution. He added that any more generation would result in a fall in pricing.
Norway’s traditional electricity export channels include the United Kingdom, Germany, Poland, Sweden, and Belgium; however, supply is on the rise in these countries as well, with Germany announcing just before Easter plans for a 70-GW fleet of offshore wind turbines to battle the end of Russian gas supplies.
Although it is anticipated that the capacity of the underwater energy export interconnectors would be increased, Utkin believes that exports of green hydrogen will actually take off.
The governments of Germany and Norway agreed in March to examine the possibility of transporting hydrogen over the North Sea to Germany, the largest economy in Europe, including by pipeline.
For the wind auctions, the government intends to open up a total area approximately five to six times the size of the Southern North Marine II license, or approximately one percent of Norwegian sea areas.
Before the 2025 sale of offshore wind licenses in new areas, the Ministry of Petroleum and Energy (MPE) will study the simplification of the licensing procedure.
Minister of Petroleum and Energy Terje Aasland said in the statement, “We must be swift, but also prudent,” emphasizing a step-by-step approach and the development of a secure and efficient power supply without sacrificing fishing and other interests. Both Aasland and Stre emphasized how the additional power supply will reduce prices, which have recently risen throughout Europe.
According to Equinor, Srlige Nordsjen II will be the first area to be developed. The government announced in February that a 1.5 GW tender would be held for the first phase of development. It was stated that the bid will be held in 2022, but no other information was provided. The notice this week did not give any additional insight on when the auction will be held. The government stated in February that a second 1.5 GW phase of construction at Srlige Nordsjen II is possible, as is the opening of the Utsira Nord leasing area.
This followed the June 2020 declaration of a royal decree allowing renewable energy development in the territories. The MPE stated at the time that Srlige Nordsjen II borders the Danish portion of the North Sea and offers export prospects. It encompasses 2,591 square kilometers and provides depths for both fixed-bottom and floating turbine construction. According to the ministry, Utsira Nord is closer to shore but is only suitable for floating wind projects.
Until the available fixed-bottom choices are exhausted, this is where developers are likely to head, according to Utkin, due to the cost disparity between fixed-bottom and floating technologies at this stage of industry development.
S&P Global believes that Norway has a 50 GW fixed-bottom offshore wind potential. Utkin stated that full mapping of the possible locations has not yet been completed, therefore it is unknown how much of this capacity is economically feasible. Nonetheless, the majority of Norway’s offshore wind potential lies in the floating section, he remarked, adding that the country enjoys first-mover advantage in the field.
The Hywind Tampen project, which is scheduled to commence operations in the third quarter of 2022, will be one of the world’s first operational floating wind farms. In addition, Equinor and Vrgrnn, a joint venture between Italy’s Eni and Norway’s HitecVision, announced in May 2021 that they intend to create floating offshore wind farms between the coasts of Utsira and Haugalandet.