ESA approves support model for floating offshore wind in Utsira Nord
The Norwegian government is making significant investments in offshore wind and aims to allocate areas for 30 GW of offshore wind capacity by 2040. The goal is for offshore wind to contribute to increased renewable energy production and help reduce greenhouse gas emissions. The EFTA Surveillance Authority (ESA) has now approved a state aid scheme for the development of a floating offshore wind farm on the Norwegian continental shelf. This approval marks an important milestone in the continued development and expansion of offshore wind in Norway.
ESA’s approval of the support scheme was a prerequisite for the official announcement of the project, and the Ministry of Energy is currently preparing the announcement.
Two-Stage Model for Area Allocation and State Aid
The development in Utsira Nord will follow a two-stage model for both the allocation of project areas and the granting of state aid. In the first stage, three project areas will be awarded through a competitive process. This will be followed by a maturation phase of approximately two years, during which selected developers will have the opportunity to further develop and refine their projects.
Following this maturation period, the selected developers will be eligible to compete for state aid. The total budget for the support scheme is NOK 35 billion (approximately EUR 2.95 billion), and funding will be provided in the form of investment grants. The scheme is administered by the Ministry of Energy, and aid will be awarded to the developer that commits to executing the project with the lowest need for public funding per megawatt. A state aid auction is expected to be held in 2028 or 2029.
A New Type of Support Scheme under the EEA Framework
The scheme has been approved by ESA in accordance with the Guidelines on State aid for climate, environmental protection and energy (CEEAG). ESA has concluded that the scheme complies with the state aid rules set out in the EEA Agreement. This is the first time such a support model has been assessed under the state aid framework.