Energy and Water Resources in Norway FACTS 2013 Energy and Water Resources in Norway Editor: Inger Østensen Editing Completed: April 2013

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Energy and Water Resources in Norway FACTS 2013 Energy and Water Resources in Norway Editor: Inger Østensen Editing Completed: April 2013 FACTS 2013 ENERGY AND WATER RESOURCES IN NORWAY FACTS 2013 ENERGY AND WATER RESOURCES IN NORWAY Editor: Inger Østensen Editing completed: April 2013 Design: iteraGAZZETTE Cover photo: Front and back: Viddalsdammen Photo: Aerosport / E-CO Energi Layout and printing: 07 MEDIA Circulation: 3000 ISSN: 0809-9464 Publication code: Y-0102/8B Photos Facts 2013: Chapter 1 Chapter start page 7: Water law Photo: TCN / Ministry of Petroleum and Energy Chapter 2 Chapter start page 23: Solbergfoss Photo: E-CO Energi Chapter 3 Chapter start page 33: Fireplace Photo: iStockphoto Chapter 4 Chapter start page 47: Street in Skrova Photo: Hilde Totland Harket Chapter 5 Chapter start side 51: Tromsø Photo: Scandinavian Stockphoto Chapter 6 Chapter start page 59: Sill at Imsa Photo: Arne Trond Hamarsland / NVE Chapter 7 Chapter start page 63: Hywind Photo: Øyvind Hagen / Statoil Appendices: Chapter start page 69 Photo: Hilde Totland Harket 2 PREFACE Ola Borten Moe Minister of Petroleum and Energy Minister of Petroleum and Energy Secure access to energy is extremely important for a modern The Hammeren power station in Maridalen in Oslo was built in society to function. Norway has large energy resources, both 1900, and supplied Oslo’s residents with electricity. This is the fossil resources such as oil and gas, and renewable resources oldest power station still in daily operation. When Hammeren such as water, wind and bio-energy. This energy wealth has power station was opened, it was declared ”now the city would been, and remains, important to social welfare in Norway. have power for all time”. Today, the annual production from the power station is enough to cover electricity consumption in Oslo For more than 100 years, we have produced electric energy for less than one day. This illustrates the enormous increase in based on hydropower. The very first hydropower plant was the importance of electric power through the 1900s and up to the built in 1882 at Senja in Troms County by the Senja Nikkelverk present. company (nickel works). The power plant on Senja was the first hydropower plant in Europe. Electricity from this power plant The objective of this Fact Sheet is to provide a comprehensive was used for lighting, which was typical for the early electricity presentation of generation, transmission and consumption of plants. energy in Norway. The Fact Sheet reviews energy supply in Norway, and provides an overview of the most important statutes The public sector owns about 90 per cent of the production capa- that set the framework for public administration. city for electric power in Norway, distributed over national, muni- cipal and county authorities. The first municipal electric power Norwegian petroleum activities are described in a separate plant based on hydropower started operating in Hammerfest in publication from the Ministry of Petroleum and Energy and the 1891, which earned the city the honour of being the first city in Norwegian Petroleum Directorate Norway with electric streetlights. Oslo followed close behind, with electric streetlights and electric tram lines in the 1890s. PREFACE 3 TABLE OF CONTENTS 1 FRAMEWORK, ORGANISATION AND PLAYERS . 7 Trading companies . 20 1 .1 ntroductionI . 8 Vertically integrated companies . 20 Ministry of Petroleum and Energy . 8 District heating companies . 20 Norwegian Water Resources and Ownership in the power sector . 21 Energy Directorate (NVE) . 8 Enova SF . 8 2 ENERGY AND POWER SUPPLY . 23 Statnett SF . 8 2 .1 Production of electricity . 24 Research Council of Norway . 9 Hydropower . .. 24 1 .2 Legal framework . 9 Capacity and production . 25 Overview of important legislation . 9 Different types of hydropower plants . .. 26 Idustrial Licensing Act . 9 Run-of-river hydropower plants . 26 Watercourse Regulation Act . 9 Flexible hydropower plants . .. 26 Water Resources Act . 9 Pumped-storage power plants . 27 Energy Act . 10 Hydropower potential . 27 Offshore Energy Act . 10 Wind power . 27 The Electricity Certificate Act . .. 10 Capacity and production . 28 Management of protected areas and Gas-fired and other thermal power production . 28 Master Plan for Water Resources . 11 Capacity and production . 29 Other relevant legislation . 12 Other thermal power . 29 Relevant EU legislation . 12 Other electricity production . 30 The EU’s three energy market packages . 12 2 .2 Production of heat . .. 30 The Renewables Directive . 14 District heating . 30 The Energy Performance of Buildings Capacity and production . 30 Directive (EPBD) . 14 Oil for stationary combustion . 30 The CHP Directive . 14 Biomass . 30 The Ecodesign Directive . 14 Natural gas . 31 The Energy Labelling Directive. 14 The Security of Electricity Supply Directive . 15 3 ENERGY CONSUMPTION . 33 The Water Framework Directive . 15 3 .1 Factors that influence energy consumption . 34 The Environmental Liability Directive . 15 3 .2 Energy consumption trends . 34 Licence processing . 15 Stationary energy consumption . 35 Case processing pursuant to the Watercourse Stationary energy consumption by energy carrier . 36 Regulation Act and the Water Resources Act . 15 3 .3 Change in the consumption and Major development projects . 15 production of energy . 36 Small hydropower plants . 17 Enova SF and management of the Energy Fund . 37 Procedure pursuant to the Energy Act Objectives for Enova’s activities . 37 (installation licence) . 17 Enova’s programme areas . 38 Processing time for licence applications . 18 Renewable heat production . 38 1 .3 Companies and ownership . 19 Buildings . 38 Companies within various areas of activity . 19 Scheme on support for alternative, renewable Production companies . .. 19 heating and electricity savings in private households 38 Grid companies . 20 Industry . 38 4 Demonstration activities of new energy and 7 .2 Energy21 . 65 climate technologies . 38 7 .3 Research programmes . 65 Enova’s advisory and information work . 38 ENERGIX . 65 Results of Enova’s work, 2001 to 2011 . 39 Centres for Environmentally-friendly Other policy instruments that affect Energy Research . 65 energy consumption . 39 CLIMIT . 66 The carbon tax, the emissions trading system Administrative research and development . 66 and the consumer tax . 39 7 .4 International R&D cooperation . 66 Programme for increased energy efficiency The EU’s Seventh Framework Programme in power-intensive industry (the PFE scheme) . 40 for Research . 66 The Technical regulation for buildings . 40 The International Energy Agency . .. 66 Regulations resulting from EU directives and decrees 40 Energy Research . .. 66 Energy labelling of household appliances . .. 40 Other international R&D cooperation . .. 67 Ecodesign . 40 7 .5 Norwegian hydropower expertise . 67 Energy performance certification of buildings . .. 41 Box 1 .1: Electricity certificates . 10 4 THE TRANSMISSION GRID . 47 Box 1 .2: Action plan for renewable energy . 13 4 .1 The power grid is critical infrastructure . 48 Box 3 .1: Energy efficiency . 37 4 .2 Description of the power grid . 48 Box 3 .2: Household energy consumption trends 4 .3 The power grid is a natural monopoly . 48 – historical perspective . 42 4 .4 Statnett SF . 49 Box 3 .3: Energy consumption in industry and energy industries since 1970 . .. 45 5 THE POWER MARKET . .. 51 Box 5 .1: The financial power trading . 53 5 .1 ntroductionI . .. 52 Box 6 .1: CCS . 61 5 .2 Organisation of the power market . 52 5 .3 How the power market works . 53 APPENDICES . 69 5 .4 About price formation . 54 Price formation . 54 APPENDIX 1 . 70 Area prices . 55 The Ministry of Petroleum and Energy’s legislation within End user price . 56 the energy sector and water resources administration . .. 70 5 .5 Power trading between countries . 57 1 .1 The Industrial Licensing Act . 70 5 .6 Pricing of grid services . 58 1 .2 The Watercourse Regulation Act . 71 Revenue cap regulation . 58 1 .3 The Water Resources Act . 71 Tariffs for electricity transmission . .. 58 Groundwater . 72 Special provisions concerning measures 6 THE ENVIRONMENT . 59 in protected river systems . 72 6 .1 Local environmental impacts . 60 Secure river systems . 72 6 .2 Emissions to air . 60 1 .4 The Energy Act . 73 Local area licence . 73 7 RESEARCH, TECHNOLOGY AND EXPERTISE . 63 Istallation licence . 73 7 .1 The Ministry of Petroleum and Energy’s use of Trading licence . 73 policy instruments within energy research . 64 Marketplace licence . 74 CONTENT 5 Licence for international power trades . 74 APPENDIX 2 . 81 District heating plants . 74 Definition of energy terms, conversion factors System responsibility, rationing and quality of supply 74 and theoretical energy content of various fuel sources . 81 Energy planning . .. 75 Power units . 81 Power supply preparedness . 75 Energy units . 81 1 .5 The Offshore Energy Act . 76 The following units are also used for electric energy . 81 1 .6 The Electricity Certificate Act . .. 76 Conversion factors and average theoretical energy 1 .7 Other legislation . ..
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