As one of the world’s largest energy exporters, Norway advances the energy security
of consuming countries. And at the same time, as a global advocate for climate change
mitigation, Norway is committed to environmental sustainability and climate policy.The
latest review of Norway’s energy policies by the International Energy Agency finds
that the country continues to manage its significant hydrocarbon resources and revenues
in a sustainable way, and remains a reliable supplier of oil and gas. But as the world
looks to cut its reliance on fossil fuels, Norway’s government should also consider
measures to prepare for a future with lower oil and gas revenues.Norway’s large hydropower
generation is another valuable energy asset particularly at a time when European electricity
markets are integrating and variable renewable energy generation is growing. More
cross-border connections are coming online and will help realise the full potential
of hydropower for balancing variations in demand and supply in the regional market.
This will also improve electricity security in Norway in times of low hydropower availability.
This review looks at how market-based investments in low-carbon generating capacity
can be encouraged by changes in taxation and subsidy systems.In order to meet its
ambitious targets to reduce greenhouse gas emissions, this review finds that Norway
needs to step up efforts at home. The IEA encourages the government to spell out more
in detail how the emissions reduction targets will be met. There is a major potential
to do so in transportation, oil and gas production and manufacturing. In this context,
a high level of public spending on energy RD&D and strong efforts to develop carbon
capture and storage are very welcome.