Norway’s Statkraft drops 1 GW of “unprofitable” wind projects

Statkraft AS has chosen not to invest in several wind projects in central Norway totalling 1,000 MW, after determining they will not be profitable as initially expected.

The Norwegian state-owned utility said on Thursday that the lower power and electricity certificate prices in the Nordic region will make the Fosen and Snillfjord projects unprofitable, which is abandoning the plans. The company explained in a statement that the growing power surplus and continued moderate demand for electricity have cut long-term price estimates.

Commenting on the news, Statkraft’s president and CEO Christian Rynning-Tonnesen said that “the market development is such that it is still not commercially responsible to invest in these projects”. Despite the current situation, the company expects wind power to become competitive in the Nordic region over the longer term.

Statkraft previously estimated the development costs for the said projects in central Norway at about NOK 11 billion (USD 1.41bn/EUR 1.25bn). Agder Energi, TronderEnergi and Nord-Trondelag Elektrisitetsverk (NTE) also have stakes in the schemes.

In January, Statkraft signed a letter of intent (LoI) with Denmark’s Vestas Wind Systems A/S (CPH:VWS) for the supply of 600 MW of wind turbines for projects in Fosen district and an additional 400 MW in the Snillfjord and Hitra area.

(NOK 1.0 = USD 0.128/EUR 0.114)

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