Norway will identify additional offshore areas to build wind parks amid strong interest from energy firms, the government said on Tuesday, as the oil-producing country seeks to build a domestic offshore wind industry.
Norway is now opening two offshore areas to build wind farms, called Utsira Nord and Soerlige Nordsjoe II, expected to produce up to 4.5 gigawatt of power.
Offshore wind is booming worldwide and Norway, western Europe's largest oil and gas producer, is examining how it can adapt its energy industry to changing demand.
The additional acreage could be identified within two years, energy minister Tina Bru said.
"We have listened to the industry, and we know making more acreage available is important," Bru said in a speech.
"Therefore, the government will initiate a process of identifying new areas for offshore wind production and conduct an impact assessment of these areas. This will facilitate future activity and provide predictability for the industry," she said.
Licenses for two or three large-scale projects for Soerlige Nordsjoe II, bordering the Danish sector of the North Sea and suitable for turbines fixed to the seabed, would be auctioned in the first quarter of 2022, Bru added.
These projects would not receive subsidies, she added.
"Considering the current cost of floating wind, any large-scale project at Utsira Nord will require state aid to be commercially viable," Bru said.
Utsira Nord is suitable for floating offshore wind turbines, a new technology that captures wind energy in waters deeper than 60 meters.
Floating turbines provided the biggest opportunity for Norway to expand the industry and create jobs, she said.
Auctions were not the right approach for floating turbine areas and the government would continue to support technology development instead, assessing the timing and level of support once projects had matured sufficiently, Bru said.
The government said national grid operator Statnett would operate the offshore grid to ensure neutral and efficient coordination of the offshore grid and to support developers.
(Additional reporting by Nerijus Adomaitis, writing by Gwladys Fouche; Editing by Terje Solsvik and Edmund Blair)