Greening industry: Opportunities and challenges in electricity access for Norwegian industry firms

Abstract

Access to clean electricity is fundamental for reducing the carbon footprint of industry, both for existing industrial operations and for producing new climate- and environmentally friendly goods and services. But the allocation of electricity as a limited resource hinges on institutional rules. In this article we examine how the process of electricity allocation impacts the establishment, growth and geographical location of new green industry firms. We examine how process impacts electricity access for green industrial firms in the context of Norway, a country with a seemingly well-functioning electricity grid sourced from renewable energy and clear political climate goals for greening industry. Through an exploratory study based on an extensive document review and in-depth qualitative interviews with key informants, we find that the management of the electrical grid, from the quantity of available electricity to the process by which firms access electricity, hinders green industry firms in accessing power. This is for three reasons: 1) regional variation in the absolute amount of available electricity; 2) unclear rules and queue systems for accessing the grid; and 3) a lengthy and potentially costly process for gaining access. These findings indicate that formal and informal rules determine the establishment of green industry firms in industrialized countries, and could hinder progress on climate goals.