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Norway

Energy

Norway’s future energy balance

Norway relies almost 100 % on hydropower in its electricity production (1,5). Research results suggest that the inflow can be 10.3 % larger in 2040 with respect to 2001, due to climate changes (1). The increase in electricity production doesn’t equal the increase in inflow, however. The supply of electricity will be about 8.4 % (12.5 TWh) larger in the year 2040: the increased electricity supply results in lower prices and thereby reduced investments in new capacity over time.

Demand for electricity will increase despite the temperature increase following climate changes. An increase in electricity demand of 4.6 TWh or 3.2 % is explained by the reduced prices, induced by the increased water inflow, wind and other supply sources. The price effect on demand will more than offset the temperature effect (1).

Norway’s future hydropower production potential

Research results suggest that the inflow can be 10.3% larger in 2040 with respect to 2001, due to climate changes (1). The increase in electricity production doesn’t equal the increase in inflow, however. The supply of electricity will be about 8.4% (12.5 TWh) larger in the year 2040: the increased electricity supply results in lower prices and thereby reduced investments in new capacity over time (1).


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Norway’s future energy consumption

Increased temperature leads to a reduction in demand for electricity in Norway and Sweden from 2001-2040 of approximately 3%. Finland will have a total reduction in demand of 4% from 2001-2040. Denmark is expected to face a reduction in annual demand of 2.5%: the reduction will be approximately 1% less due to smaller temperature changes (1).

The temperature dependent demand for electricity is expected to decrease by roughly 3% in most of the Nordic region. However, demand for electricity will increase by 6.3 TWh (1.4%) in the climate change scenario. This is a result of more supply leading to reduced prices, and consequently an increase in demand that will more than offset the initial temperature effect (1).

Norway’s future wind energy potential

The coast of Norway is exposed to strong wind, and the development of this energy source is important when considering if and where to invest in wind power. There will be a little increase in the wind speed as the climate turns warmer and more humid in the period 2001-2040. The annual increase is 1.2% in 2040 (1).

Electricity export to other countries

The electricity trade between the Nordic countries will change somewhat from 2001 to 2040, but the major pattern will stay the same. The Nordic region will stay an overall net exporter of electricity and there are only minor differences in magnitude between 2001 and 2040. The trade between the Nordic region and the rest of northern Europe is mainly based on exchange between a hydropower dominated area and a thermal dominated area (1).


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Climate change impacts on electricity markets in Western Europe

The expected climate changes in the 21st century are likely to have a small impact on electricity prices and production for the energy markets of Western Europe. This has been estimated by modelling three climatic effects (4):

  • changes in demand for electricity due to changes in the need for heating and cooling,
  • changes in supply of hydropower due to changes in precipitation and temperature, and
  • changes in thermal power supply due to warmer cooling water and therefore lower plant efficiency.

According to the model results each of these three partial effects changes the average electricity producer price by less than 2%, while the net effect is an increase in the average producer price of only 1%. Similarly, the partial effects on total electricity production are small, and the net effect is a decrease of 4%.

The greatest effects of climate change are found for those Nordic countries with a large market share for reservoir hydro. In these countries total annual production increases by 8%, reflecting an expected increase in inflow of water. A substantial part of the increase in Nordic production is exported; climate change doubles net exports of electricity from the Nordic countries, while the optimal reservoir capacity is radically reduced (4).

Adaptation strategies

National context is important for adaptive capacity in that it provides essential instrumental framework conditions within which adaptations can happen. The Swedish framework leaves a larger room for adaptations than the Norwegian, in particular towards future climate change. The Swedish regulatory framework allows for investments in robustness, while the Norwegian system emphasises economic efficiency at the cost of considerations like security of deliverance, and also shows a larger gap in current vulnerability. The Swedish companies, accordingly, have spent more on adaptations than the Norwegian ones (3).

References

The references below are cited in full in a separate map 'References'. Please click here if you are looking for the full references for Norway.

  1. Gabrielsen (2005)
  2. Saelthun et al. (1998), in: Kirkinen et al. (2005)
  3. Inderberg and Løchen (2012)
  4. Golombek et al. (2012)
  5. Chernet et al. (2013), in: Halsnæs et al. (2016)
  6. Thorsteinsson and Björnsson (2012), in: Halsnæs et al. (2016)
  7. Widén et al. (2024)
  8. Arthington et al. (2018a, 2018b), in: Widén et al. (2024) 

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