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NVE will not extend commissioning deadlines beyond 31 December 2021

In a letter to all concession holders dated 27 November 2019, the Norwegian Water Resources and Energy Directorate (NVE) announced restrictions on its practice of extending commissioning deadlines for wind power farms.
Wind power

Previously, commissioning deadlines could be extended on application and such applications were rarely rejected. In recent years, commissioning deadlines have been linked to the deadline for becoming eligible for an el-certificate under the electricity certificate system, which is 31 December 2021.

The purpose of extending commissioning deadlines was to meet the political goal of promoting and supporting investments in new wind power farms in Norway.

However, going forward, it will be harder to obtain an extension beyond 2021. The commissioning deadlines for wind power projects were discussed in Report 25 (2016-2016), which was submitted to the Storting (Stortingsmelding). According to that report, concessions for wind power may prevent the positive alternative development of the relevant land and prolong local conflicts. In cases where years have passed since a concession was granted, it has also been argued that there may be a need for new studies and possibly even a new concession process due to a change of conditions in the area.

As such, wind power projects that are not commissioned before 31 December 2021 may lose their concessions. The developer may then choose to apply for a new concession based on the same project. This will likely require the original concession application to be updated and new studies and reports to be carried out and produced. The authorities will need to take a sensible approach in this regard by:

  • permitting prior applications to be reused, with necessary updates; and
  • fast tracking the application process for key projects.

The NVE has stated that projects which are under construction and experience commissioning delays will be granted an extension if the delay is due to force majeure.

The threshold for extensions appears to be stricter than that which will apply in practice. However, given the short deadline of 31 December 2021, the number of projects with final concessions whose environment, transport and construction plan is awaiting NVE approval and congestion on the turbine supply side, the NVE must clarify how this new deadline will work and whether it will accept further limited extensions or delays in relation to commission deadlines.

This article has also been posted by ILO (International Law Office).