The Norwegian government has proposed up to 35 billion Norwegian crowns ($3.29 billion) in subsidies to support the country's first commercial floating wind power tender. The proposal aligns with a preliminary plan outlined in June and reflects the government's commitment to advancing offshore wind development on its continental shelf.
Energy Minister Terje Aasland stated, “Norway has enormous potential for floating offshore wind on its continental shelf, but because the technology is still immature and expensive, government support is needed to speed up development.”
Inflation and rising costs for turbine makers and suppliers have driven developers to seek substantial subsidies to make floating wind projects viable.
The proposal, which forms part of Norway's 2025 budget, maintains the subsidy offer at the level agreed in June, despite expectations from some in the industry that it might be increased. The government based its calculations on a reference project of around 500MW, though the actual capacity that will be realized will depend on factors like project maturity, future cost developments, and the return requirements of bidding companies.
The tender initially focuses on Utsira Nord, a region off southern Norway's coast, with a combined capacity of up to 2.25GW across three sites. At least 13 consortia and individual bidders have shown interest in the project.
During a recent consultation on the subsidy scheme, several respondents expressed concern that the government's assumptions regarding future power prices and costs were unrealistic. The government has estimated the need for subsidies at 1.42 crowns per kilowatt hour (kWh), but industry participants pointed to a recent UK award for a floating wind farm at 2.7 crowns/kWh as a more practical benchmark for future projects.
