5. Norway’s GHG emissions and climate policies
In 2020, there were 48.9 million tonnes of CO2-equivalents emitted domestically in Norway. The biggest emissions sources in Norway are oil and gas extraction (24.5%), other industry (23%), road traffic (17%), other transport (15%), and agriculture (10%).36State of the Environment Norway: “Norske utslipp og opptak av klimagasser”, https://miljostatus.miljodirektoratet.no/tema/klima/norske-utslipp-av-klimagasser/
Norway has to a large degree achieved international obligations to reduce emissions by purchasing carbon credits based on emission cuts in other countries.37NOU 2023:25 p. 40. Since 1990, Norway has only reduced its domestic emissions by 4.6%.38State of the Environment Norway: “Norske utslipp og opptak av klimagasser”, https://miljostatus.miljodirektoratet.no/tema/klima/norske-utslipp-av-klimagasser/
Norwegian authorities have set several targets for reducing emissions. In the Norwegian Climate Act, the target for 2030 is that GHG emissions are reduced by at least 55% compared to 1990 levels.39Climate Change Act. Act of 16 June 2017 no. 60 on climate targets. For 2050, the target is that Norway becomes “a low-emission society”, where GHG emissions are reduced by 90-95%. However, these targets may be fulfilled together with the EU through emissions trading. This means that there is no obligation under the climate law to reduce domestic emissions. The Government-appointed Climate Committee 2050 stated in 2023 that “[t]he question is not which emissions should be reduced, but which minor emissions remain in 2050”.40The Norwegian Government: «Press release NOU 2023: 25 The transition to low emissions – climate policy choices towards 2050», https://files.nettsteder.regjeringen.no/wpuploads01/sites/479/2023/10/Pressemelding_engelsk.pdf
The agreement with the EU firstly relates to emissions that fall within the EU Emissions Trading System (ETS), mainly emissions from industrial activities. The Norwegian Climate Act explicitly states that participation in the EU ETS is relevant for assessing progress towards the targets. Norway also has agreements with the EU to reduce emissions that are not subject to the EU ETS by 40% by 2030, covering mainly emissions from transport and agriculture. The EFTA Surveillance Authority (ESA), responsible for monitoring implementation of this agreement, warned in 2023 that “Norway expects a significant gap towards its current targets,” and was therefore “strongly encouraged to consider additional measures to reduce their emissions”.41EFTA Surveillance Authority, Climate Progress Report 2023, 2023 p. 4.
In addition, the Government has committed to reducing domestic emissions by 55% by 2030 compared to 1990 levels.42The Norwegian Government: “Hurdalsplattformen. For en regjering utgått fra Arbeiderpartiet og Senterpartiet 2021-2025”, https://www.regjeringen.no/contentassets/cb0adb6c6fee428caa81bd5b339501b0/no/pdfs/hurdalsplattformen.pdf p. 29. This means that 50% of Norwegian emissions must be reduced in the next six years. It is debated whether the Government has a sufficiently realistic plan to achieve this goal.
Norway is the world’s 8th largest producer of natural gas, and the 12th largest producer of crude oil.43UNEP et al. The Production Gap: Phasing down or phasing up? Top fossil fuel producers plan even more extraction despite climate promises, 2023, p. 68. Annual emissions from the combustion of exported Norwegian oil and gas are approximately 500 million tons of CO2, which is at least ten times higher than Norway’s annual domestic emissions.44NOU 2023: 25 p. 211. In general, 95% of emissions relating to petroleum come from the ultimate combustion/burning of oil and gas, and only 5% from the production. Norway has plans to expand, not phase out, oil and gas production and export.
The Norwegian Petroleum Directorate estimates that Norway’s oil and gas production will continue to rise in 2024 and 2025, almost reaching the record-high production levels of 2004.45Norwegian Petroleum Directorate, «Sokkelåret 2022», 9 January 2023, https://www.npd.no/aktuelt/publikasjoner/rapporter/sokkelaret/sokkelaret-2022/; Nerijus Adomaitis, “Norway’s oil production seen rising 5% in 2024”, Reuters, 6 October 2023, https://www.nasdaq.com/articles/norways-oil-production-seen-rising-5-in-2024-0. While the Directorate projects a gradual decline from 2026, UNEP and others, with reference to the Directorate’s reports, state that “the rate of decline is uncertain and depends heavily on possible new discoveries and thus on government policy for exploration”, where “official forecasts tend to underestimate resource growth”.46UNEP et al. The Production Gap, 2023, p. 68; Norwegian Petroleum Directorate, Resource Report 2022, p. 58. Historically, projections of future oil and gas production have been lower than actual production.47NOU 2023: 25 p. 229, 230.
The total amount of energy used in Norway in 2021 was 326 terawatt hours (TWh), 42% of which came from electricity and 50% from fossil fuels.48NOU 2023: 3 p. 45. Unlike many other comparable countries, almost all electricity used by households and services in Norway comes from renewable sources, mostly hydropower (88%), followed by wind power (10%).49Tilnull.no: “Hvor mye av energibruken er fornybar?” https://www.tilnull.no/energibruk; Statistics Norway: “Betydelig nedgang i strømforbruket», https://www.ssb.no/energi-og-industri/energi/statistikk/elektrisitet/artikler/betydelig-nedgang-i-stromforbruket-i-2022.
Norway will need more renewable energy as industries transition away from fossil fuels and overall energy consumption continues to grow, but the exact estimates of future demand vary. The Government-appointed Energy Commission estimates that an additional 21-35 TWh will be needed in 2030.50NOU 2023: 3 p. 10. The commission’s majority recommended that Norway should have a goal of an increased capacity of at least 40 TWh from hydropower, solar energy and onshore and offshore wind, and free up at least 20 TWh from improving energy efficiency.51NOU 2023: 3 p. 24. The Norwegian Water Resources and Energy Directorate responded that it is unrealistic to get an additional 40 TWh from renewable energy sources by 2030, but considered it ambitious and possible to achieve 20 TWh in energy efficiency and 5-10 TWh in increased solar capacity.52Norges vassdrags- og energidirektorat, Høringssvar fra NVE – NOU 2023:3 Mer av alt – Raskere – Olje- og energidepartementet, 27.4.2023.
Current government policy is to use a significant proportion of the available renewable energy to electrify the production of oil and gas. While this can reduce Norway’s domestic emissions, it is likely to increase Norway’s exported combustion emissions. It is debated whether electrification of production will reduce overall global GHG emissions.53Faktisk, Åtte spørsmål og svar om elektrifisering av sokkelen question 6 17.1.2022; Thema; Elektrifisering av olje- og gassektoren – har det global klimaeffekt?,Rapport nr. 2022-23, 6.1.2023. In any case, it will tie up available renewable energy.54NOU 2023: 25 pp. 252-254.