BNCC, together with Equinor and KPMG Norway, organized an event to discuss how Norway can collaborate in enabling clean energy investments into emerging markets, with Brazil as an example case. Scatec Solar, Statkraft, ZERO, the Differ Group and Equinor, together with an opening presentation by the Ministry of Foreign Affairs, delivered an interesting dialogue on the energy outlook in the context of climate change, and some of the key lessons, risks and tools at the disposal for Norwegian companies entering emerging markets.
Of course, governance and sector-wide challenges persist, such as low predictability, the financial viability of off-takers, and affordability and willingness to pay of end users, among other obstacles, which combine to make market entry for the private sector risky, said Mr. Svelle. To offset some of these risks, Mr. Svelle presented the Norwegian government's recently lauched Guarantee Scheme that will inject up to 300 mill. NOK annually in a period of 3-5 years.
Following the instruction of the guarantee mechanism, Larissa Slottet, Executive Director of BNCC, moderated a panel discussion between representatives from Scatec Solar, Statkraft, ZERO, the Differ Group and Equinor on their experience, ongoing initiatives and key lessons learned, from their efforts to promote clean energy in emerging markets.
Kicking off the discussion, Tom Erichsen, CEO of Differ Group, explained that the energy outlook is “more renewable, more distributed, and more off-grid.” Distributed, sustainable energy will be key to meeting development and climate goals. Erichsen explained that the guarantee scheme was as a welcome instrument for the off-grid market and distributed energy companies (DESCOs), which are usually characterized by the absence of power-purchase agreement based (PPA) models.
Per Kristian Sbertoli, Head of Renewable Finance from Zero, echoed the importance of leveraging Norwegian expertise in combating coal. “The key trends in the sector are represented well in this panel,” explained Mr. Sbertoli, referring to Statkraft’s interest in wind and solar; Scatec’s increasing focus on establishing solar in fragile markets and the commercial & industrial (C&I) market; Differ’s emphasis on distributed energy systems; and Equinor’s priorisation of offshore wind.
Looking at Brazil, the panel discussed how the county is an attractive market for green energy investments. While Brazil has a well-developed hydro and renewable sector, representing some ~40% of the internal energy supply. And there still exists vast unexploited potential in wind, solar, and floating solar PV, explained Slottet. Speaking on behalf of Statkraft, Simen Bræin, Senior VP International Power, shared the lessons learned from their operations and recently acquired 663 MW of wind capacity in Brazil. Notable lessons from the engagement were how power markets are becoming increasingly sophisticated and complex, characterised by Brazil's move into hourly pricing, which introduces spot price exposure to combine with PPAs. Further trends in the move from stable baseload to more intermittent power, and end-users expecting companies to integrate sustainability into core business, all work to increase complexity of the sector. Given the complexity, securing "capital is not the problem, its competency," explained Mr. Bræin, and the regulatory and governance challenges that arise from more sophistication.
In responding to some of these challenges, the MFA also plans to increase its support to Norfund, an essential vehicle providing risk mitigation measures to companies, explained Mr. Svelle during his presentation. By working closer with to the private sector and being more responsive to the obstacles facing Norwegian companies, it is hoped these new risk mitigation mechanisms can play a key role in mobilising Norwegian investment, experience, and expertise to reinforce market development for renewable energy abroad.
One company actively involved in emerging markets is Scatec Solar, which is aiming to double its installed capacity from 1.9 GW, over the next two years. In Brazil, its 50-50 joint venture with Equinor is driving local value creation, explained Scatec's VP Project Development, Axel Holmberg. “Our ability to manage risks in complex environments comes from collaborating with governments, political bodies, and local stakeholders before starting a new project”, he emphasized. The rising demand for energy in the country, Slottet explained will be an opportunity for Norwegian renewable energy companies like Scatec. “As a chamber of commerce, we are well positioned to support those Norwegian companies that would like to enter Brazil market but may need more information or potential partners to make that a reality”, said Slottet.
Wrapping up the panel discussion, Equinor’s lead for wind Project Development, Justine Burg, explained the company’s Climate Roadmap, a strategy to reduce emission measures through better energy management and technical design in oil and gas projects. Burg explained the strategy is compliment by Equinor’s target to scale up its investments with ~20% of its portfolio by 2030, illustrated by its exciting work on offshore wind.
Following the Q&A with the panel, attendees were then invited to an extended mingling session at the KPMG offices in Majostuen. KPMG’s international Development Advisory Services (IDAS) practice is actively working on climate change and, in partnership with leading Norwegian consultancies, delivering an unique and holistic approach to renewable energy development in emerging markets.
See the presentation from MFA here.
By Larissa Slottet, BNCC/ Matthew McKerman, KPMG.
Mutual exchange of employees between companies based in different countries broadens the perspectives and changes the attitudes of people, making businesses more capable of achieving their goals. The Norwegian Agency for Exchange Cooperation (Norec) funds exchange projects involving employees in Norway and countries in Latin America, including Brazil.
The Brazilian and the Colombian chambers of commerce invited Norec to present their opportunities to their members in a breakfast meeting that took place at Christiania Kvartalet in Olso last week. Norec is financed by the Norwegian National Budget, forms part of the governmental Norwegian developmental policy, and is subordinated to the Norwegian Ministry of Foreign Affairs.
Representatives from the chambers welcomed the audience and passed the floor to Tor-Øyvind Rand, who explained how does Nored works and gave many rich examples of the program in action.
Exchange between countries benefits not only organizations and businesses but communities, explained Tor-Øyvind. It spread knowledge and inspire both individuals and organizations. The program of exchange was developed on the Sustainable Development Goal number 17, Partnership for the Goals, he added.
The exchange takes place between businesses and organizations – partners – in Norway and countries in the southern hemisphere, or in between these countries. The partners have to identify the project they want to establish and with whom they wish to cooperate then apply the project on Norec’s webpage (www.norec.no).
Norec has the intention to increase their portfolio in Latin America. Therefore partners in Brazil and Colombia are most welcome to apply, independent of the industry or size of the companies. Norec offers training for the partners and participants, preparing in the best way possible to create fruitful exchange programs and successful partnerships.
The benefits of Norec exchange programs are many. A company can increase technical skills, strengthen intercultural communication, build strong partnerships. In a broader perspective, diversify and globilize skills and knowledge. Moreover, contribute to developing and sharing skills and knowledge in Norway and developing countries.
After Norec’s presentation, partners under the exchange projects presented their experience and the advantages through the program. Hostelling International (HI) Norway and Brazil brought talked to the audience sharing their perspective of how usual and enricher the initiative has been to help to achieve their goals.
A live Q&A session took place, where the audience had the opportunity to ask practical questions to Norec representatives and to the organizations that are under the program now. Larissa Slottet from BNCC closed the meeting, remembering all presents that mixing people and transferring knowledge is an excellent opportunity to step ahead towards the future. She encouraged all members of BNCC to explore further this opportunity.
See the presentation of Norec here. For more precise information for cooperation with Brazil, you can contact Cristina Latine: (email@example.com).
By Larissa Slottet, BNCC
Aker Solutions is combining their experience in developing and managing offshore projects to provide these solutions. The economy of scale is increasing the turbine size, which booms the global need for offshore floating wind. Aker Solutions will be a leading provider of offshore wind energy solutions, including planning, installation of the offshore wind farms, commissioning, operations, and maintenance services. Moreover, the company foresees a new era of ocean economy opportunities with energy production offshore.
The audience took the opportunity to ask several questions during the presentations and finished the session with an inspirational hope for the future of the energy sector. You can see the presentation here. BNCC appreciates the possibility of inviting our members and learning more about the innovative operations of this vital member.
By Larissa Slottet, BNCC
Last week BNCC and NHO gathered their members in a breakfast meeting with the Norwegian Ambassador to Brazil, HE Mr. Nils Martin Gunneng at NHO premises in Oslo. The Brazilian Ambassador to Norway, HE Mr. George Monteiro Prata was also present to do a short intervention on his perspective about the topics presented.
Tore Myhre, Director for International Affairs at NHO, welcomed the audience with more than 50 participants, representatives of diverse organizations and from the business sector. Ambassador Nils Gunneng started his presentation, that had a focus on the economy and the political development that influences economic growth.
Ambassador Nils Gunneng briefly introduced Brazil's far-right president Jair Bolsonaro who took office on 1 January. He explained Bolsonaro’s campaign proposed economic policies that are positive and necessary, in a shared sense of what is expected for the economic policies in the county. Brazil is slowly recovering from a devasted recession. This period is difficult, takes time, and brings many challenges. Brazil is vast, and a continental tank is never able to turn directions overnight.
The Ambassador agreed that Brazil’s pension reform, which could pass soon, is essential to increase the economy. President Bolsonaro promised a different approach from the former government, with the liberalization of the economy. Besides pension reform, which could pass soon, the Minister of Finance and Trade, Paulo Guedes wants to propose other changes that could boost the economy: Tax Reform, Privatization of several state companies, and development of trade deals.
Ambassador Gunneng indicated confidence that pension reform will pass. With this reform in place, Brazil’s finance will save sufficiently to boost the economy. The fact that congress and government are talking so much about tax indicates that after the pension reform, the tax system will be the next step. Another piece of good news is the Mercosur-EU trade deal and negotiations with EFTA, that are developing further. Also, de-regularization for foreign investment went through the house. It will be less bureaucratic to establish companies in Brazil. All this shows that the Brazilian economy is not boosting but is moving to the right side.
Balanced with these hopes, however, are the ability of Bolsonaro’s team has to negotiate the proposed reforms and secure necessary support in complex Brazilian congress. The Ambassador shared his thoughts that conflicts between the government and congress can lead to a turning mood from the society. Also, the ability to deal with international agreements and trade partners is important.
When coming to values, Brazil and Norway are currently far apart on certain issues. The new government of Brazil consists of several people with lack of experience with formal politics and somewhat unrealistic prospects about what is possible and not possible to do. Some actual values defended by this government are unfortunately interfering in the good relation Brazil and Norway use to have. The current government of Brazil have very different values from what Norway is used to relate, and Norway is learning how to deal with these differences, explained the Ambassador.
After the intervention of the Ambassadors, a vibrant Q&A session took place. The audience wants to know more about the consequences of environmental politics and deforestation. Both Ambassador shared their perspectives about the topic. At the moment of the event, that was not official, yet that Norway would suspend its donations to the Amazon fund. The Norwegian ministry of climate and environment confirmed this decision in the evening following this event.
Several high-level executives have been present in this meeting. Taking advantage of his presence, the organizers invited Luis Araujo, CEO of Aker Solutions, who is Brazilian, to give an overview of the state of affairs in Brazil from the perspective of the industry. Araujo gently accepted the challenge and shared his views with the audience.
Araujo believes that Brazil is on the right way for boosting the economy. He gave us an example. Aker Solutions' plant in Brazil is the biggest and most modern subsea plant in the world successfully operating and exporting talents from the country. When considering business and economic measures, he is optimistic. As a manager, he tries to disassociate from day-to-day noise and concentrate on the potential of the country. However, he mentions that the government values matter and can influence the success of international businesses operating in the country.
Aage Thoen, chairman of BNCC, presented closing remarks remembering the importance of developing further a health relation in the commercial arena and keeping looking to Brazil as a country of in numerous opportunities to the Norwegian business sector.
A mingling session took place where members from BNCC and NHO could meet, exchange experiences and discuss their ideas.
By Larissa Slottet, BNCC