Smakraft to Build Six Hydropower Plants in Norway in 2013

Smakraft AS, majority-owned by Norway’s biggest utility Statkraft AS, plans to build six hydropower plants this year at a cost of about 270 million kroner ($49 million).

The plants that will generate electricity by running water through turbines will have a combined capacity of 25 megawatts, Rein Husebo, managing director of Bergen-based Smakraft, said by e-mail. They’ll produce 65 gigawatt-hours of power a year and be financed through Smakraft’s owners, he said.

Norway generated about 95 percent of its electricity from hydropower in 2010, according to International Energy Agency statistics. Smaller hydropower installations are generally considered more environmentally friendly as building big dams and water reservoirs for storage isn’t required.

Small hydro potential in Norway of an estimated 25 terawatt-hours has “considerable” interest from investors, Husebo said, whose company operates 34 smaller hydropower plants. Realistically, 4 to 5 terawatt-hours could be built before 2020, he said.

“The government has established a system to build this and it’s working well,” the managing director said. “At this stage we don’t need more from the government.”

Norway and Sweden started a common green certificate market a year ago to spur renewables. Electricity suppliers must get a certain portion of power from low-carbon sources or by purchasing green certificates that have a tradable value. Allowing renewable certificates to trade freely between the countries helps them meet clean power targets at a lower cost.

Smakraft has 140 projects currently in the planning process or awaiting concessions, Husebo said.

To contact the reporter on this story: Louise Downing in London at ldowning4@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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