Norwegian industry stands to save billions in energy costs

“For Norwegian industry, this is an opportunity to move billions directly to the bottom line, with positive environmental and climate impacts as a bonus,” said Oskar Gärdeman, Market Manager Industry, New Technology and Renewable Energy at Enova. He believes that the Paris Agreement (see fact box) is Norway’s big chance to generate positive climate effects while also strengthening our competitiveness.

Energy management has an immediate effect on the bottom line

“The potential for savings in Norwegian industry is huge and we have R&D environments that are capable of developing the technology that the world will be looking for.”

Norway’s ambition in the Paris Agreement is to increase energy efficiency by 27 %. This requires efforts on three fronts:

  • Energy management. This can give us 3 TWh immediately, without major investments.
  • Use of existing technologies.
  • Development of new technology.

“Businesses in the industrial sector will see an immediate effect on the bottom line simply by learning more about energy use and greenhouse gas emissions. Energy management, better structures and smarter operation are the lowest hanging fruit. A penny saved is a penny earned,” said Gärdeman.

The potential is vast. Simply by increasing awareness and knowledge of current consumption levels, companies can reduce their energy costs by 10%. If the entire Norwegian industrial sector realised this potential, that alone would give us 3 terawatt hours (TWh).

Norway can be the engine driving technological development

The really big, long-term opportunity lies in the development of new technology. The aim is to produce more while using less energy. Norway’s advantage lie particularly in the aluminium, ferrosilicon and forestry industries, which are industries where Norway has above-average expertise.

“Consumers worldwide are becoming more aware of the value – and necessity – of products manufactured with low energy consumption and greenhouse gas emissions. This consumer trend has not yet gained full momentum, which means that Norway still has a chance to position itself at the forefront. But we need to hurry – once this trend has become mainstream, it will be too late.”

Expertise and incentives are necessary

Gärdeman believes that cooperation between actors like Entro and Enova is crucial in our efforts to comply with the Paris Agreement.

“Energy management requires expertise if it is to have any effect. Companies like Entro are extremely important in efforts to meet the targets set out in the Paris Agreement and in creating competitiveness. They have the expertise and combine it with an understanding of economics – saving energy should provide effects in terms of profitability, the environment and the climate. Where large investments are required, Enova can provide funding so that we can increase the pace of restructuring.”

Is it possible?

Paris Agreement and terawatt hours are big words for many smaller industrial companies. Can we really achieve the change we want?

“Yes! Developments in recent years demonstrate that our efforts will pay off. As an example, Norway’s mainland industry has improved energy efficiency by more than 6 TWh over the last 13 years through Enova-funded projects alone. Companies like Entro are making a very important contribution to creating immediate financial benefits. Attitudes and consumption patterns are also changing. But what is most important is our attitudes. We must look at the Paris Agreement as an opportunity for growth, not a cost-savings project.”

Facts about the Paris Agreement:

  • Global warming must be limited to two degrees, and we should work to achieve 1.5 degrees.
  • The world must be carbon neutral by the last half of this century.
  • It says nothing about how quickly we need to cut emissions only that we must do so “as quickly as possible”.
  • National climate plans should be updated every five years – and preferably strengthened.
  • From 2020 onwards, we must use at least USD 100 billion annually on climate technology in developing countries. This money is to come from rich governments and trade and industry.
  • Poor countries affected by climate change must receive financial support, but there will be no automatic compensation schemes.