– I think Norway is probably one of the countries that makes the least changes, which is still considered one of the least risky countries to enter, he added.
He is a former manager of the Government Pension Fund abroad, also known as the Oil Fund.
Several wind farms have announced that they risk going bankrupt with the government’s proposed ground rent tax for wind power, which is planned to be introduced retroactively and confiscate 40 percent of the free cash flow.
Prime Capital is strongly critical of the tax proposal and has said that they would rather move investments to other countries, while the Finnish wind power developer Taaleri Energia, which owns the Haram wind power plant, has threatened legal action against the Norwegian authorities.
Must reduce the risk
Slyngstad believes that globally close to 4 trillion dollars must be invested annually in the green shift to achieve the climate goals, which is a doubling from the current level and corresponds to around 4 percent of the world’s gross national product (GDP).
He pointed out that there is obviously enough money in financial markets, but that it is going to the wrong place. He believes that the large institutional investors must step in to move enough money to green investments.
– Then it is the projects that give the best returns that cause the money to be moved. In this area, it is a question of how to reduce the risk and create solutions that offer less risk for investors, he said.
He believes that a challenge for investment in wind and solar is that the technology will improve if you wait a year, which means that it does not pay to be early.
– The second is that there simply aren’t enough long-term electricity price contacts for you to manage to fill this up and get it in place. This makes the idea that the market will solve it very unlikely, unless you get a completely different structure on the energy market itself, said Slyngstad.
In Norway, he pointed out that complicated processes for developing offshore wind means that there will be a long delay in the whole process, where no one starts planning today and puts in place the capacity to actually get it done.
Slyngstad also pointed out that there are both risks linked to construction capacity in the supplier industry, the price of electricity in the long term and deliveries to get the projects started.
– And in all three places there are now major bottlenecks and difficulties in finding the good projects, he added.
However, he pointed out that the biggest investment expense will be the power grids that have to be built to make it happen. He added that it is more complicated than it seems as the power system must always be in balance.
– That balance is going to be a huge problem. I am not entirely convinced that people are clear about the challenges there will be in getting all the wind power that is now being produced in the North Sea into the European grid, said Slyngstad.