Norway became one of the richest countries in the world thanks to its vast reservoirs of oil and natural gas. As green energy takes root, utilities and grid companies want to replicate some of that success with hydro power.
The Nordic nation’s rich supplies of water enable hydro plants to feed almost all domestic electricity needs and have some left over for neighboring countries too. The Dutch grid already is drawing Norwegian power, while projects are underway to link with England and Germany. A link to Scotland is awaiting approval.
The technology has a key advantage over solar and wind farms — operators can decide when to release the water through turbines, making its supply of clean energy as dependable as a traditional fossil fuel plant. But the vision of Norway as a giant green battery for northern Europe has detractors at home. Companies from energy-intensive smelters to chemical makers fear that additional connections will boost power prices and cut the competitive edge that cheaper hydropower has given them for decades.
But as the nation’s hydro plants to a large extent are owned by the state and municipalities, that would boost the national coffers, according to a company spokeswoman. The more than four decades of oil and gas exports helped Norway create the world’s biggest wealth fund with $1 trillion in assets.
An expansion of wind power in both Norway and Sweden could dampen any potential price increases from rising exports. Norway is planning to tap in on its very favorable wind conditions along its western coast.
But after Statkraft AS and a Credit Suisse Group AG-backed fund said it would invest $1.2 billion in wind power in wind parks in the central Norway, development has largely stalled in large due to local protests. The regulator hasn’t approved any new applications since April and is waiting on a new framework.