Last week the public statistics authority in Norway (Statistics Norway) published its projections for investments in numerous areas (O&G, power, industry and mining). Results show that once again, investments in wind power are increasing rapidly, with the power delivery investments up by 22% so far between 2017 and 2018.
Statistics Norway gives special credit to wind power for this increase in investment, as Norway has recently seen several projects coming to force, and several new wind power plants are being constructed as we speak.
I myself do not find these figures to be very surprising. Just in August, I have seen several articles depicting the continued growth in the Norwegian wind sector, and several developers that are active in the county are ramping up their plans to develop more onshore wind farms. There are several reasons behind this investment interest in Norway, but for the country itself, wind energy seems to be the only reasonable step to avoid energy shortages in the future.
Scandinavia has just had one of the warmest summers recorded for decades, with a miniscule amount of rain falling. In Norway, the country recorded the warmest May in over 100 years. This has created problems such as wild fires in Sweden and general drought across the whole region. Norway, who relies hevily on hydro energy, has with the shortage of rainfall seen a challenge this summer in producing enough energy from their hydro power plants, which has resulted in shocking electricity prices for consumers. It is painfully clear that the Scandinavian climate is changing fast, and that it is becoming increasingly warmer. With this in mind, investments in wind power seem to be a solid choice.
So, who are the investors and main players in the Norwegain wind energy sector right now? Well, utility company Statkraft have revealed that they are planning to ramp up their wind and solar power developments in the coming years. According to the company, this is part of an updated strategy, formed in response to technological developments. Statkraft also mentions optimisation of hydro power, decarbonisation and other investment opportunites in renewables. Clearly, Statkraft intends to remain at the core of the renewable energy transition in Norway.
With the recent completion of the installation of Roan wind farm up north, the Fosen wind project is well on its way. All 71 Vestas turbines at Roan wind farm are now installed and schedued to go live before the end of the year. Once the project is completed, the wind farm is expected to produce 900 GWh per year. The next two phases of Fosen wind (Storheia and Hitra 2) are scheduled for installation in the spring of 2019, with deliveries to the final three Fosen wind farms due to kick off in 2020.
Another player in Norways renewable energy sector is Eolus Vind, a Swedish developer with active branches in the baltics and USA, as well as Scandinavia. The company recently offloaded Stigafjellet wind farm (30 MW) just south of Stavanger) to EWZ. The deal states that Eolus will build the wind farm, and EWZ will finance the construction. The wind farm is expected to be commissioned during the second half of 2020.
So who are the main investors behind all this onshore wind development in Norway? Well, it seems some of the main players lately are Luxcara, SUSI Partners and MEAG, who are all frequently mentioned in the news. Foreign investment in norwegian wind is however somewhat of a touchy subject in Norway. The sentiment goes: if they are investing in Norwegian wind, they should have Norwegian subsidiaries and Norwegian companies, as to create jobs and economic growth in Norway. Now, this debate has been ongoing for some time now, and for the foreign investors and developers to be succesful in the long run, they really should take the local sentiment into account. Moreover, it makes it easier to operate in Norway if you actually have a norwegian subsididary. There are some quite complex laws in place in this beautiful country.
However, it is not only onshore wind farm development that is on Norways agenda. Norway has long been known as the largest oil producing nation in Europe (not really a title to be proud of nowadays). However, a few years back, Norway realised offshore wind was one of the major renewable energy sources, but as this realisaton hit, so did the price boom in the oil and gas industry. Therefore, most local Norwegian companies could not participate in the development of offshore wind.
Now times are changing for Norway, and at the 2018 Energy Outlook conference, the norwegian minister for petroleum and energy stated intentions to strengthen the supplier industry by enhanding offshore wind energy. Although Norway may have limited areas to actually develop offshore wind, there are four areas that have been identified as appropriate for offshore wind, and later on this year, the government plans to decide on two of these that can be developed to offshore wind farms.
The Norwegian outfit Head Energy recently made a statement that the company will continue to expand their offshore wind units. Fair play to them as well, offshore wind accounted for 9% of the companys overall order book in in the first half of 2018 (which is up by 7% since 2017). Head Energy is committed to reduce its oil dependence and actively position the company in a more balanced energy landscape. This trend seems to be growing, with companies like Ørsted (former Dong Energy) in Denmark rebranding and ditching it's oil business, and Equinor (former Statoil) going greener. This is two companies who are historically known as oil and gas powerhouses – going green. What a spectacular change.
But why limit yourself to one type of offshore wind? Norwegian Equinor owns the 30 MW Hywind Scotland, which is the worlds first commercial floating wind farm, together with Masdar. Another Norwegian floating wind developer is Sway.
However, there are diverging opinions regaring floating offshore wind in Norway, and if it is actually something the country needs. Norwea and Energi Norge have been debating weather support should be given to these offshore developments. The main concern is that Norway would by the year 2030 have a surplus of energy which is not needed. (This is quite interesting considering the energy shortage this summer when hydro went down). Regardless, this will be something interesting to follow over the next few years, as Norway strives to leave their oil and gas image behind them.
The global trend at the moment is to become renewable (and it's about time). The future of wind power is looking positive indeed, and Royal Dutch Shell (I am still waiting for them to change name to something else and rebrand with a green image), anticipates that global energy demand will continue to grow over the 21st centrury as the population continues to grow. (However, even this will stagnate at some point, as most growth curves tend to do). With that said, wind power is anticipated to have an annual growth rate of 11.3% between 2020 and 2025. Good news for the world indeed.
So, where does this leave Norway? Well, as I see it, Norway is currently in an exiting stage of new developments and projects, and I truly believe that Norway will continue to grow its wind energy sector over the next years. It will definetly be interesting to follow the development of the county, and also to see how different companies tackle the various challenges involved in doing business in Norway.
As I myself have recruited for various clients across the Norwegian wind energy sector over the past year, I know it does come with it's challenges. As many other regions in Scandinavia, there are skills shortages in electrical maintenance and civils, two areas which the development and maintenance of wind farms cannot live without. As it is challenging to send non-norwegians to work in Norway (not because of language skills, but due to tax implications), it is always best to employ locally in Norway if possible.
With that said: if you are looking to hire over the next year or so in Norway, or if you are a foreign company planning to expand your business into Norway, I am happy to help with my knowledge of the local market. I can also assist you with recruitment in this sector, as Norway is one of my core recruitment markets, and I have a broad network of qualified candidates, many with wind experience, in my network. Other regions I recruit for myself is Sweden, Denmark and Finland, and Cathcart Energy have branches across the UK & Ireland, Germany, France and the Netherlands as well. By being a niche recruitment agency, we have become trusted specialists in our sector.
Moreover, if you are a candidate and you are thinking of your next career more, in Norway or any of our other regions, feel free to get in touch with me on +46 40 668 80 66 or by sending me an email: email@example.com, as I am happy to speak wth you for both current and potential future roles (or direct you to a colleague if you are keen on a role outside of Scandinavia).
It is often the case when I speak with a candidate that I don't have anything relevant at the moment. However, when something does come along from one of my clients, I know what you are looking for and in which region, and then I can easily get in touch with you to see if this is something you might be interested in. As the saying goes: networking is everything.
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