Speech/statement | Date: 03/02/2020 | Ministry of Petroleum and Energy
State Secretary Odd Emil Ingebrigtsen held this speech at the Norwea Finance Seminar in Lysebu, Oslo on January 30th 2020.
Good afternoon! Thank you so much for the invitation.
I was appointed state secretary to minister Tina Bru just a few days ago. My previous job was in the energy sector, as CEO at Indre Salten Energi. I was invited to join this seminar last year. This year I could make it, but from another position.
Today's seminar is a great opportunity for me to get to know the wind power industry better.
Norwea has put together an interesting program, and many topics are of great interest both for the industry and for me as a politician.
First, let me focus on some key points on the governments' energy policy.
Even though the politicians at the Ministry have a tendency to change, the government's overall energy policy is stable.
The government wants to increase economic activity on the back of a well-functioning power system. We want to facilitate profitable and socio-economically sound development of renewables.
We aim for long term and predictable policies that provide stable conditions for the wind power industry and investors in general.
The White paper from 2016 reaffirmed the government's commitment to a market-based development of new renewable energy projects.
Norway runs on renewable electricity. Hydropower is, and will remain, the foundation of our energy system. Its storage capacity and flexibility provides a balanced power system. This helps keeping prices stable and ensures a robust and secure energy supply.
We will further utilize our hydro power plants. Many of the plants are approaching the time for re-investments.
Upgrading hydro plants is often put forward as an alternative to wind power developments. The potential for increasing the energy generation from hydropower is, however, limited. Wind is the renewable energy alternative with the greatest potential in Norway.
Wind power can become a significant supplement. In a few years, we expect wind power to generate ten per cent of Norwegian electricity.
Since we first started to exploit our hydropower resources some 130 years ago, renewable energy has powered our industry and society as a whole. Despite some loud protesting in a few projects, I would say that Norwegians in general are proud of our energy industry. They have a lot of trust in it, because it brings light and heat into our everyday life, houses and business – in a safe and sound way.
The wind power contributes to our surplus of renewable power. This gives Norway a unique opportunity to utilise electricity in new ways and to create new profitable jobs. For example, in the Norwegian power intensive industries.
It has been fascinating to see the speed in the development of new technology, making wind power competitive in more markets.
At the end of the last quarter of 2019, over 2 000 megawatts of wind power were under construction in Norway, expected to generate more than 7 terawatt hours of electricity annually. That is a substantial increase in the amount of wind power compared to recent years.
The high activity in construction of wind farms and the prospect of new projects have also triggered quite a bit of public debate.
In October last year, the public hearing of NVEs proposal for a framework for onshore wind ended. To say the least, this also created a few headlines.
We have seen a growing debate since then. We welcome a good public debate. It shows emotions and engagement. However, it has become too polarized, and is often dominated by those who cry out the loudest.
I hope for a more balanced debate, and a greater focus on the need for new, green energy in the future.
An unbalanced debate affects both the reputation and trust in the government as well as the industry.
And by extension, I would like to highlight the importance of acting in accordance with the rules. I encourage the industry to follow government regulations thoroughly, and to ensure good processes with local actors. This affects how the industry is portrayed. It is also the best way to ensure progress in a project.
Some wind power opponents point to the fact that international investors finance many wind farms and repatriate the profits. In our view, this is a feature of a well-functioning market. We welcome foreign investors as well as Norwegian investors.
Let me be clear – international investors are welcome to invest in Norwegian wind farms. Norway has a long tradition for international investors in the development of our industries.
There might also be some interesting possibilities for wind power projects with limited grid connection, for example along with hydrogen or battery production.
I believe that Norwegian wind power resources will continue to be attractive for investors also beyond 2020. However, it is up to you, as developers and investors, to make the commercial decisions. The task of the government is to put appropriate and stable conditions in place.
So, to the question you may all want an answer to – what is next?
After receiving NVEs proposal for the national framework for onshore wind last year, the government decided not to go further with the 13 appointed areas. We are, however, working to adjust our policies, with special emphasis on the licensing procedures.
It is important for me to emphasize the value of the knowledge we have gained through the national framework project. We have never known as much about wind power here in Norway as we do right now.
We have also received valuable inputs from the public hearing on aspects such as local impacts and the tax system for wind power.
We are now reviewing the licencing procedure to improve and tighten current practice. We are looking at deadlines, at local and regional involvement, and how to best take environmental issues into consideration.
We will await clarification on these issues before we resume licencing again. I cannot give you an exact date for this today.
It is important for me to emphasize that licences already approved are final. A licence is the result of open and democratic processes where both municipalities and stakeholders are involved. A licence given to a wind power developer is not retractable, even if the municipality has changed its mind.
Investors, entrepreneurs and licence holders need to trust the decisions that have been made. It all comes down to the importance of stable conditions.
I mentioned the rapid technological development earlier. Offshore wind is certainly one area where things are moving quickly.
Both floating and bottom fixed offshore wind power offer great opportunities for Norwegian businesses. We can use our experience from industries such as oil and gas, renewable energy and shipping, to take part in a global market.
Even though offshore wind is a relatively new industry, it is the most important export industry within renewable energy.
The ministry just ended a public hearing last November, where we proposed to open two areas for offshore renewables. We also asked for input on whether a third area should be opened.
We received around 300 replies. We see that many are concerned about various aspects of this type of renewable energy production, such as the effects on birdlife and the fisheris. Others call for increased state funding in order to stimulate the technology development.
The cost difference between onshore and offshore wind power is still considerable. Offshore will probably not be competitive in the Norwegian power market in the near future.
However, the pace of technology development could continue to surprise us. Therefore, we think now is the time to make space available and set up a detailed regulatory framework for this promising industry.
The wind power industry is now truly starting to gain a foothold in Norway. It used to be a small contribution to our renewable energy production. But now, wind power plays a much bigger role.
Today's host Norwea has really been pushing this development forward, and deserves credit for that.
So, as I am reaching the end of my speech, let me sum up my main points:
The government wants wind power in areas with good wind resources, grid connection and acceptable consequences for the environment, for people and benefits for the local communities.
We aim for long term and predictable policies that can provide stable conditions for the industry.
And as I said, we most welcome investors – both international and national.
We need to work together to create a greater understanding for the future need for renewable energy, especially if the future is going to be electric and green.
Needless to say, we have an eventful year ahead of us. I look forward to exchanging views on the future of wind power in Norway with you all.
Thank you very much to Norwea for inviting me. I wish you the best of luck with two engaging days.