Op-ed: “What It Takes for Norway to Stop Being a Climate Slow-Mover”

Written by
Hydrogen Mem-Tech
Posted
08/01/2024
Category

Op-ed by Thomas Reinertsen, CEO, Hydrogen Mem-Tech, first published in Norway’s Verdens Gang, January 8th, 2023.

Stronger, larger, and more flexible muscles are needed to pull the Norwegian climate train out of the station.

It's refreshing to see the head of The Norwegian Confederation of Business and Industry (NHO) Ole Erik Almlid create a verbal sense of climate emergency as he does in an interview with Verdens Gang ahead of this year’s NHO conference.

This comes in light of a recent report commissioned by NHO from Boston Consulting Group, concluding that Norway is a slow-mover compared to our Nordic neighbours and countries like Germany, USA, and Canada in terms of climate action.

Why did we fall asleep at the wheel? Where were we when the train left the station?

We represent the sector of the green transition focused on hydrogen. From our headquarters in Trondheim, we build hydrogen separators that convert dirty gas into clean hydrogen. We're in a phase of scaling up our hydrogen separation technology, targeting the global market. This is Norwegian-developed technology with immense international potential and utility in the critical energy transition we are amidst.

From this vantage point, we've gained insights that not only NHO and Norwegian politicians could consider. It is also a call to arms for investors and industrial players in general:

1. Politicians and the industry sector must dare to invest significantly in large, concrete projects. Many have ridiculed former Prime Minister Jens Stoltenberg's 'Moon Landing' at Mongstad. Yet, it was both ambitious and brave, with high technological and strategic transfer value. Perhaps the project was ahead of its time? There's a vast difference between the state supporting comprehensive demo projects and sprinkling funds thinly, sometimes over companies that might not be viable.

2. Almlid and NHO, along with The Norwegian Confederation of Trade Unions (LO), previously co-signed a report on Norwegian hydrogen investment. This was a welcome initiative, but the report heavily emphasised subsidies as the main form of business support. The primary tool for attracting risk capital and international investors to Norwegian clean energy projects is creating predictability. This includes both tax-related and safe economic operational conditions. We need to re-establish our position as a haven for green capital. Currently, it seems more attractive for ambitious green transition investors to place their money in other countries.

3. To develop viable solutions, industrial pro-activity is needed to achieve competitiveness and profitability in the earlier phase of a company's development. Norwegian investors have to step up in this game. Perhaps the most significant contribution to cutting emissions faster is to lower the threshold for investing in environmental technology. Maybe Norway's own renewable fund, Nysnø Klimainvesteringer AS, could play a more aggressive role in shifting the perception that Norway are lagging behind in the green transition.

"Capital goes where the conditions for green transition are best," says Børge Kristoffersen, head of BCG's energy work in the Nordics, in the same Verdens Gang article. The current system of incentives plays a crucial role in the early stages for many companies. We are ourselves grateful for the help we've received. But it's not enough, as stronger, larger, and more flexible muscles are needed to pull the climate train out of the station.

The last time we raised money in a capital raise, we experienced greater interest from foreign investors than Norwegian ones. If such investors are deterred by an impression of poor conditions and predictability in Norway, it's no wonder we're falling behind.

Nobody wants to throw money at a climate slow-mover.