Conferences

That is one of the key questions the Norwegian Parliament will face this fall, and the backdrop for a debate during Arendalsuka on Thursday. At stake is not only how Norway secures the power it needs, but how offshore wind is financed and politically justified.

A radial cable, which is the choice for the first major offshore wind project (Sørlige Nordsjø II), sends electricity exclusively into the Norwegian grid. It is simple, familiar and politically easier to defend because it lowers domestic electricity prices. Analyst Olav Botnen at Volt Power Analytics estimates a reduction of NOK 0.11 in Southern Norway price area and NOK 0.7 in neighboring areas.

But the economics are harsh. A radial connection sits idle roughly half the time, unable to export surplus power when prices abroad are high.

“Radials are expensive to operate and need strong public support to make them viable,” says Botnen.

Hybrid cables tell a different story. They connect offshore wind farms to multiple countries while also connecting national grids. With continental spot prices often around NOK 0.8, compared to Norway’s NOK 0.6, hybrids can serve as interconnectors when the wind is not blowing.

“Hybrids may not need subsidies at all,” Botnen noted, pointing to the cable’s ability to trade in the European market when prices spike. The risk, however, is political: if too much power flows to Europe, Norwegian spot prices could rise. “That is why hybrid agreements must include negotiated safeguards,” said Botnen.

Jørgen Bjørndalen, Energy Adviser at DNV, argues hybrids solve a deeper structural challenge. “Bottom fixed wind parks lie far offshore and require expensive grid solutions. The genius of hybrids is that trading opportunities finance the cable,” says Bjørndalen – and continues: “Cost sharing models like Bornholm show how countries can split expenses fairly and realize projects that would otherwise be difficult to justify.”

Member of Parliament Aleksander Stokkebø (Conservative Party) believes Norway should embrace hybrids: “Just look at the map. The area closest to Europe is ideal for a hybrid solution. We must reduce subsidy needs to maintain legitimacy for offshore wind.”

Arne Thomassen, Mayor of Agder County, agrees the issue will be central in the Norwegian Parliament. He warns that offshore wind has suffered from delays and political reversals: “You don’t build new industry by having repeated reversals. We need a binding timeline.”

Kristian Johnsen, Project Manager for the regional offshore wind collaboration project Fremtidens Havvind, also stresses the need for predictability to allow the industry to build competence and capacity to enter the emerging Norwegian market.

“For Agder, offshore wind represents a chance to build an entire industrial value chain, from turbine blade production to new port infrastructure,” says Johnsen.

To succeed abroad, Norwegian companies depend largely on industrial cooperation agreements that bind foreign suppliers to Norwegian partners. These agreements have long been a cornerstone of national defense industry development, as Norway continues to import most of its materiel. With 80 percent of industry turnover coming from international markets, the Norwegian defense sector must be competitive globally.

Shipbuilder Umoe Mandal has successfully transformed into a pure defense company, focused entirely on maritime systems, composite structures and military platforms.

CEO Tom Fidjeland puts it bluntly: “A job has to be maritime, in composites and military. Otherwise, we’re not interested.”

Umoe Mandal’s niche expertise is world class and customers are generally foreign. The domestic market is simply too small. The company’s future depends on securing international contracts and being plugged into major programs through industrial cooperation agreements.

Kitron adds another layer to this picture. With half its turnover in defense and operations across several countries, Kitron shows how Norwegian competence can anchor international supply chains. Their recent work supporting Ukraine highlights the importance of scaling and mass production, capabilities Norway has not yet fully tested at home.

“Another challenge for Norway is to prioritize in situations when supply chains cannot sufficiently serve all parties. In such cases, commercial interests often trumphs societal needs,” said Hans Petter Thomassen, VP Nordics and North America at Kitron.

Kitron and Umoe Mandal discussed these matters during an Arendalsuka event organized by Fremtidens Forsvarsindustri Sør (FFS), Agder County, GCE NODE, and Digin.

Norway holds a unique position within geothermal energy: World class drilling expertise, a highly electrified society in need of greater resilience, and vast untapped thermal resources beneath our feet.

While Sweden produces around 23 TWh of geothermal heat annually and Finland 7 TWh, Norway lags behind at 4-5 TWh despite having the strongest drilling competence in the Nordic region.

This gap, which illustrates both the challenge and the enormous potential, was addressed during an Arendalsuka event hosted by Geothermal Energy Association of Norway, GCE NODE, NORCE Research and SINTEF.

Geothermal energy offers qualities Norway increasingly needs. As energy security becomes more critical, reliance on a single energy carrier, electricity, creates vulnerability.

Storms, sabotage, cyberattacks, and grid constraints all expose the fragility of a system built on centralized power production. As Kristin Flornes, EVP at NORCE Research emphasized, a resilient society requires local, stable energy sources that function regardless of weather, market volatility, or grid bottlenecks. Geothermal heat is exactly that: always available, always local, and independent of electricity prices.

Kirsti Midttømme, Chief Scientist at NORCE Research, highlighted another strength: geothermal systems are inherently decentralized. With more than 75,000 installations already in place, Norway has a foundation to build on but lacks the policy instruments that accelerated deployment in Sweden and Finland. Price signals alone will not unlock growth; targeted support mechanisms are needed to scale the industry.

Jesper Moberg, CEO of Norsk Retningsboring, gave a perspective that underscored Norway’s most significant competitive advantage: drilling competence.

“For geothermal energy, we rely heavily on the competence and technology from the oil and gas industry. We have the world’s best drillers. Our technology is proven, scalable, cost competitive, and leaves only a small mark on the surface. Geothermal energy is ‘the obvious solution’, yet political recognition remains limited,” said Moberg.

During the closing debate, Members of Parliament Mani Hussaini (Labour Party) and Frøya Sjursæther (MDG), acknowledged that geothermal energy is not a hot topic in the Norwegian Parliament.