Norwegian–German Energy Partnership: for a strong and competitive Europe

Berlin, 27 February 2015

'Our two countries enjoy close relations on a broad range of topics, included energy. More often than not, we see eye to eye on international issues and have a shared approach to major challenges', said Minister of EEA and EU affairs Vidar Helgesen in his statement at an energy conference in Berlin.

Excellencies, ladies and gentlemen,

First, it is a great pleasure for me to be in Germany again. Our two countries enjoy close relations on a broad range of topics, included energy. More often than not, we see eye to eye on international issues and have a shared approach to major challenges. Our economic relations are broad and run deep.

Second, I am honoured to address this distinguished audience of German and international political, business and civil society leaders. After a long day of discussions, this sumptuous dinner is particularly welcome. As you are aware, Norway is proud to take 35 % credit for all hot meals in Germany, since this is our share of your gas supplies. This meal is so good that I am happy to take the full credit. Yet I believe that you are here tonight first and foremost because you care deeply about Europe's challenges and opportunities ahead – as I do.

We meet at a time when Europe is being put to the test. Our vision of a politically stable, secure Europe that will prosper and follow a path of sustainable growth is being challenged, externally and internally, by short-term crises as well as long-term trends.

We appreciate the leading role the German government have taken in diplomatic efforts to seek a solution to the crisis in Ukraine.

This crises has brought energy security to the very top of the European energy and foreign policy agenda. Norway supports the ambitious energy security goals of the European Union and its emphasis on infrastructure development and efforts to improve market efficiency.With much political attention focused on energy, it is also important for me to stress that Norway remains a long-term, commercially based supplier of energy to Europe.

An ambitious agenda

Focus today has been on strengthening the internal energy market, ensuring security of supply and encouraging innovation. This is an ambitious agenda in itself, but it is in fact about much more than energy and competitiveness.

It is ultimately about our common future and about Europe continuing to play a leading role in dealing with global challenges.

Germany is right at the centre of this. Your Energiewende is evidence of both courage and determination, and represents the kind of bold political leadership we need to tackle climate change, not just in Europe, but globally.

Acts of courage are often met with criticism as well as praise. And while it is true that challenges have surfaced along the way for the Energiewende, we should remind ourselves that these are still early days for Europe's energy transition. Germany is paving the way for a green shift in Europe. And I am sure that including international energy partners in your discussions, as you have done, will advance the process as you continue to pursue your Energiewende.

The way we produce, trade and consume energy is changing. This will involve and affect all of us. By working together to make this transition, we can also make it more effective and less costly.

Norway will play its part. Rich in energy resources, both renewable and fossil, our country has been a reliable supplier of energy to the rest of Europe for many years.

Norway's export of natural gas

Every year we export more than 100 billion cubic metres of natural gas to the EU through pipelines. This accounts for between 20 and 40 % of total gas consumption in Germany, the UK, Belgium and France, the four largest importers of Norwegian natural gas.

One of the best ways Norway can contribute to European security of supply and the transition to a low-carbon society is to continue to deliver natural gas to Europe. When it replaces more carbon-intensive energy sources, gas can bring about substantial cuts in emissions in the short term.

As a flexible energy source, gas can also provide balancing power in a system in which the share of intermittent renewable energy is increasing.

So yes, natural gas can and should be an important part of the bridge to our shared, low-carbon future.

Another way we can provide energy for the rest of Europe is by supplying hydropower, which accounts for almost all electricity generation in Norway.

This is a resource that is already playing an important role in providing storage and energy balancing services to the European energy system, and has further potential. In hydropower systems, energy can be stored and released from reservoirs as and when it is needed.

Norway is one of Europe's green batteries. To this end, electricity interconnection capacity between Norway and the rest of Europe is being expanded.

The final investment decision on the NordLink cable between Norway and Germany was made earlier this month – which is welcome news, indeed.

We see this as an important first step in long-term, mutually beneficial cooperation between our two countries in the field of electricity.

Interconnectors make it possible for us to use our energy resources more efficiently. They increase security of supply, and they allow for better integration of renewable energy.

Together with the planned interconnector with the UK, the NordLink cable will increase Norway's interconnection capacity by almost 50 %. This increase will serve the European energy transition well.

A well-functioning, integrated energy market is, in our view, the single most important factor for security of supply in Europe, and it is at the heart of an effective climate policy. We are therefore pleased to be part of the EU internal energy market through the European Economic Area Agreement, and to work alongside you in implementing the Third Energy Package in order to complete market integration.

Without adequate infrastructure and interconnectivity, we will not have the functioning, fully integrated European energy market we seek. Both require long-term investment in capital-intensive projects. A key question is how we can ensure that investment – and the right kind of investment – takes place.

We must rise to the challenge

The answer may be easy, but what it requires is not: long-term, broad political commitment. Predictability attracts investment. By its very nature, a period of transition – which some call an energy revolution ­- involves a degree of unpredictability.

We who are politicians must rise to the challenge. We need to put in place a predictable policy framework that is independent of election campaigns and party lines to encourage the investments that Europe needs, while letting producers and consumers play their part in the energy transition. Energy must be sustainable, reliable and affordable.

Going it alone is not an option for any country. In Norway, the current share of renewables in our energy mix is some 65 %. Even so, the transition to a low-carbon society and the green shift are hot topics in our country, too. We have known for a long time that 2014 would be the peak year for income from the petroleum sector. The falling oil prices will accelerate the pace of economic reform and our pursuit of green competitiveness.

Part of our national discussion focuses on how we can use our experience and expertise in, among other, the marine and maritime industries, hydropower and offshore petroleum to contribute to the green shift and create additional opportunities for employment and green growth. Research and innovation are key factors, and another very important area of cooperation between Norway and the EU.

The Norwegian government recently proposed that Norway should cut greenhouse gas emissions by at least 40 % by 2030, in line with the EU's binding target. The EU is continuing to play a leading role in efforts to mitigate climate change with its 2030 climate and energy policy framework. Norway will seek to fully integrate with these efforts – to be part of the "EU bubble", and believe we can make a valuable contribution to the implementation of the EU framework.

At the same time, this can lay the foundation for an effective climate policy at home and provide greater predictability for our industry and business sector.

Ladies and gentlemen,

No long-term challenge we face today looms larger than climate change. This is something that all countries must deal with and requires a sustained effort from all stakeholders and at all levels of society, from the political to the individual. Energy is part of the problem, but clearly also a key part of the solution. We need to find smart ways of tackling the problem, and we cannot postpone action.

Germany's leadership in Europe will remain crucial. Konrad Adenauer, and the other European Union founding fathers, once had the vision and ingenuity to promote and ensure European cooperation at a critical time in history – through industry and energy cooperation, but with the ultimate aim of lasting peace.

We are living at a time today that requires the same sense of purpose, and the same boldness and concerted effort.

Thank you!