16 June 2021

Orsted chief warns on seabed leasing drought for wind farms

Mads Nipper, the CEO Orsted said there was a clear appetite from a growing number of companies to develop projects but delays to licensing decisions risked pushing up costs as competition for acreage increased. Nipper pointed to the rising cost of seabed auctions in the UK, saying some companies were “desperate” to grab offshore licences as they play catch-up in offshore wind. At the start of the year, a BP-led consortium promised to pay the UK’s Crown Estate combined fees of more than £460m a year for rights to build two schemes in English and Welsh waters, which analysts and rivals described at the time as “staggering”. “Those people who have shown the highest willingness to buy a foot in the door in the industry, they obviously have the potential to create imbalances that are not good for the industry,” Nipper said. “If imbalances are created, that means that the entire industry will either be less competitive, or end up having less value-creating products, and that’s not good.” (Financial Times)

World's longest subsea interconnector begins testing

Less than a month after Norway’s cable opened to Germany, the North Sea Link, a 1,400-MW interconnector between Norway and the UK's starts testing today. Full commissioning is expected ahead of this winter. The first megawatts of electricity will flow between Norway and the UK Wednesday along the longest submarine power cable in the world. Once fully operational Britain is expected to import supplies of low carbon power on a regular basis.

The North Sea Link’s Norway’s hydroelectric reserves with the UK's massive offshore wind capacity. The Financial Times notes that Interconnectors supplied about 8% of UK power in 2019, a figure that is expected to rise to as much as 19% within the next five years. It could help lay the foundation for ever bigger interconnector projects in future — including prospects such as the Sun Cable between Australia and Singapore and the IceLink between Iceland and the UK. (Energywatch)

Norwegian Youth take Arctic oil to European Court

Six young climate activists, along with two major environmental organisations from Norway, are filing a historic application to bring the issue of Arctic oil drilling to the European Court of Human Rights. The environmentalists argue that, by allowing new oil drilling in the midst of a climate crisis, Norway is in breach of fundamental human rights.

In 2016, the Norwegian government opened up new areas for oil drilling in the Barents Sea. The six activists, alongside Greenpeace Nordic and Young Friends of the Earth Norway, hope that the European Court of Human Rights will hear their case and find that Norway’s oil expansion is in breach of human rights.

In their application called “the People vs. Arctic Oil“ to the European Court, filed today, the activists argue that the law is clear: “The allowance of new oil drilling in vulnerable areas in the Barents Sea is a violation of Articles 2 and 8 in the European Convention on Human Rights, granting me the right to be protected against decisions endangering my life and well-being. As a young person from the Sea Sámi culture, I fear the impact that climate change will have on my people’s way of life. The Sámi culture is closely related to the use of nature, and fisheries are essential. For our culture to continue without the traditional harvesting of the oceans would be impossible. A threat to our oceans is a threat to our people,” said Lasse Eriksen Bjørn, one of the activists. (Greenpeace)

Norway aims to be a pioneer in the circular economy

The Norwegian Government presented a holistic strategy for the circular economy, with a goal that Norway to become a pioneer in a green, circular economy. Through the new strategy, the Government will strengthen the opportunities for consumers to know how to make good, sustainable choices in line with circular thinking. (press release)

Volvo Cars to test fossil-free steel from SSAB

Volvo Cars will be the first car manufacturer to work with SSAB on fossil-free steel, through the Hybrit initiative. With 20-35% of the carbon dioxide emissions in Volvo Car's material and manufacturing process coming from steel the two companies are now starting a collaboration to explore the use of fossil-free steel in the automotive industry.

As part of the collaboration, Volvo Cars will secure steel made from hydrogen-reduced iron from Hybrit’s pilot plant in Luleå. The samples will be used for testing purposes over several years. The ambition is to eventually develop a concept car built wholly or partly with the new steel. There is no timetable for any commercial production and Volvo Cars does not report any financial details. (Dagens Industri, Breakit)

What we’re reading

• Oil likely to hit $100 a barrel, say top commodity traders (Financial Times, paywall)
• Carbon trading will drive emission cuts in commodity supply chains,  Jeremy Weir, chief executive officer of Trafigura (Financial Times, paywall)
• Mercuria pledges half its investments to energy transition (Financial Times, paywall)

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