Statkraft plans to invest NOK 80bn in Norway

Europe’s largest renewable energy producer Statkraft is ramping up its investment plans in Norway, setting aside NOK 80bn, or around EUR 7.4bn, over the next ten years, mainly for maintenance and upgrades of major hydropower plants.

In January 2024, the Norwegian company had estimated it would invest around NOK 44-67bn.

The updated investment forecast, according to Statkraft, reflects both a larger project portfolio, inflation, and an extended planning horizon.

”By investing NOK 80bn, we are undertaking one of the largest industrial programmes in Norway for many decades. In practice, we are rebuilding major hydropower plants,” as Statkraft’s EVP for the Nordics Pål Eitrheim phrases it in a press release Tuesday.

CEO Birgitte Ringstad Vartdal calls the investment forecast ”fully aligned with our new strategy to concentrate investments in our core business.”

”Over the past two years, we have invested nearly NOK 4bn in Norwegian hydropower, but this level will increase substantially in the years ahead,” she adds.

More than NOK 70bn out of the 80bn are earmarked for hydropower investments. Around half of the total amount is allocated to major maintenance of existing assets, intended to ”safeguard current generation capacity,” writes Statkraft.

The other half is set aside for ”upgrades, further development, new capacity and output.”

”Investment in hydropower is essential to maintain production, as many of our facilities are approaching the end of their operational lifetime,” Eitrheim says.

Vartdal calls the hydropower plants ”remarkable assets” that require ”considerable investment,” despite often being portrayed as ”almost cost-free.”

”The infrastructure and technology have delivered electricity for decades, and we are committed to extending their lifetime as far as possible. We are dealing with tunnels excavated 60–80 years ago. We are now entering a phase where much of the equipment is reaching the end of its service life, while tunnels and waterways require upgrades,” Vartdal says.

Aims to double wind power generation

While Statkraft’s investments in hydropower will provide ”modest increases in generation,” the capital it is allocating for new wind farms and repowering of existing farms will be able to ”deliver substantial additional energy output,” the company notes.

In fact, the aggregated investments planned for upgrading and developing hydropower over the next ten years will ”deliver less new energy output” than Statkraft’s planned Moifjellet wind farm alone, Eitrheim highlights.

“Norway needs more electricity to ensure stable supply for industry, and in the short term, wind power is the only technology capable of delivering this,” he says.

”In replacing ageing wind farms, we are aiming to significantly increase output while reducing the number of turbines. We are drawing on experience from similar repowering projects in Spain. Our estimates indicate that we will more than double our wind power generation over the next ten years,” Eitrheim adds.

Statkraft emphasises that these projections are subject to change depending on electricity demand and other factors.