Norway

Norway

New minister keeps industry waiting -- Another Norwegian hiatus

Norway's beleaguered wind industry is waiting to see the first policy moves from Terje Riis-Johansen, the country's new energy minister. Riis-Johansen took over the energy reigns from Åslaug Haga who, after just a year in the job, resigned from her post in June amidst a political scandal, which includes allegations of tax evasion.

The industry is hoping the new minister follows up quickly on pledges by Haga to introduce legislation and support programs that will bring about a long term market -- installed wind capacity has stood at 386 MW since the end of 2007.

Haga had promised an overhaul of the project permitting system and a continuation of the current program of 25% capital grants to selected wind projects to 2010, with a goal that would roughly double national wind power capacity. Haga said NOK 500 million (EUR 63 million) would be set aside for the program, to be implemented by the government's renewables agency, ENOVA. Meantime, talks would continue with Sweden for a long term market, based on cross-border green certificates market. Sweden's wind power market is already based on green certificate trade.

"Hopefully Haga's work in switching the focus to new renewables will continue," says Øvind Isachsen of the Norwegian Wind Energy Association (NORWEA). "Norway needs a person with understanding of the potential of wind power." He says he believes the government's energy department is now on the right track and all Riis-Johansen need do is lead the way.

Riis-Johansen has continued the talks with Sweden, publicly proclaiming that the common certificates market should be designed by October 2009. Sweden, he says, is in agreement that the market structure should be put into place soon after, although Norway's neighbour has previously indicated that a joint system is unlikely to be introduced before 2010-2012. For the wind industry, that is too long to wait if it is to meet Norway's goal of producing 3 TWh of electricity from wind by 2010, which Riis-Johansen says is an achievable goal.

NORWEA says raising the current levy on electricity bills from NOK 0.01/kWh (EUR 0.001) to NOK 0.03/kWh (EUR 0.003/kWh), as discussed with Haga, will raise enough cash for the capital grants needed to reach the 2010 target (Windpower Monthly, May 2008). Riis-Johansen is yet to comment on the plan.

Now both NORWEA and sister organisation Swedish Wind Energy say there should also be a joint certificate system specifically for offshore projects. The two are discussing the price certificates would need to be sold for to attract investors.

Meanwhile the backlog of new power projects submitted to the Water and Energy Directorate for approval continues to grow, with wind accounting for around 100 of the 600 projects (mostly hydro) still waiting. The directorate has already warned that as much as 75% of the proposed wind plans will not go ahead. Norway's weak transmission system cannot handle the extra traffic, it says.

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