The Norwegian electricity system will also be severely affected and impact on the industrial economy and people's livelihoods due to reduced reservoir storage as a result of reduced rainfall and the impact of Russian and European energy sources. The government has therefore introduced a measure whereby the state will pay 80% of the price above 70 øre/kWh when the price of electricity exceeds 70 øre/kWh, which will lift further to 90% from 1 October to December. The Norwegian authorities will develop and review their contingency plans, and Petroleum and Energy Minister Terje Aasland said that power restrictions would be avoided until the snow melts in spring 2023.
To prevent Norway from exporting too much electricity, the government is proposing that southern hydro producers stop supplying water as much as possible in the short term to save water for the winter in order to cope with the winter energy shortage. In the short term this will lead to higher electricity prices, but prices are likely to be lower in winter. Norway will be affected by the energy problems in Europe and the world, and we need to be prepared for this, while the government will also help families in need.
The Swedish wind and solar farm developer, OX2 had positive numbers to report in their latest financial report for 2Q22 (Dagens industri/Di). Revenue increased from SEK 950 million last year to SEK 1.469 million this year. Given the ongoing energy crisis, the climate is favourable for companies like OX2, and it, like many others working with renewable energy, saw stocks go up after the US announced plans for a major climate support package. CEO Paul Stormoen, however, says that money is not sufficient for implementing change effectively: “Of course it is positive that energy is high on the agenda […] But support packages are not what we need. We need simplified and faster processes for permits. […] The projects we are building now will be able to deliver electricity by 2025. This will not be an answer to the problems that Germany will face this winter, for example.”
Oil giant Equinor reported adjusted pre-tax profits of US$17.6 billion, compared to US$4.64 billion in the same period last year, and invested NOK560 million in renewable energy in the second quarter. President and CEO, Anders Opedal said that its renewable energy sector accounts for more than 20% of its total investment this year. By 2026, it will have invested around NOK 230 billion in renewable energy, and by 2030, it will have 12-16 GW of offshore wind. He believes that the company will not offer further investment ambitions in renewables, as the licences issued by the government has delayed investment in renewables, accompanied by high and uncertain price fluctuations in oil prices and strikes by oil workers demanding wage increases. But analyst Oddvar Bjørgan from Carnegie believes Equinor has not increased its renewable energy investments because of a lack of returns due to the intense competition for projects.
Danish companies have exported more than $200 billion to the US market. Dansk Industri (DI) estimates that this figure could soar to $430 billion with the new US climate deal. The US is interested in green energy, energy renovation, consulting, water technology and other solutions proposed by Denmark. The US plans to have a climate-neutral society by 2050 and an emission-free electricity sector by 2035. The plan includes a number of rebates to encourage the use of renewable energy and measures to support greater electrification of US businesses and society. President Biden is also very concerned about climate issues and has proposed building 60,000 wind turbines in the US and making all new commercial buildings climate neutral from 2030 onwards, and Danish companies have very good prerequisites to help achieve this ambition.
In 2021, DI entered into a partnership agreement with the New York State Energy Research and Development Authority (NYSERDA) to provide $50 million in sustainable retrofit projects. DI also helped more than 200 Danish companies with everything from market and customer awareness to business plan preparation and political advocacy during this year's Climate Week. Louis Funder, head of DI's US office, encouraged Danish companies interested in the US market to contact the US office for assistance.
The market for electric cars is growing faster than predicted, which has increased the demand for charging points. According to calculations made by Boston Consulting Group (BCG), three million charging points and 600 hydrogen filling stations will be needed in Sweden by 2050, when 95% of Sweden’s vehicle fleet will ideally be electric. Today, there are only 2,550 charging stations and 13,800 charging points according to the Swedish Energy Agency (Sw., Energimyndigheten). “The EU's announcement to ban the sale of new vehicles with internal combustion engines from 2035 is a game changer for the global automotive industry and also for Sweden,” says Mikael Ternhult, Partner and Managing Director at BCG Stockholm.
To read BCG’s full report on how to reach Nordic Net Zero, click here.
The Nordic countries are some of the most dynamic and successful economies in the world. They are also leaders in sustainability, from renewable energy, biofuels, carbon capture and storage and the hydrogen economy, circular economy business models and battery development, the Nordics are pioneers in policy design, technology development and consumer uptake. Mundus Nordic Green News is covering this transition for the international community. Every day we curate the stories of most relevance to international businesspeople and policy experts from the flow of news. Mundus Nordic Green Indices summarise the meta-data from our daily coverage to enable easy tracking of trends. We supplement these with our own opinion pieces and commentary.