Governance of hydropower in Scandinavia


Governance of hydropower in Scandinavia, and the implementation of hydropower projects, is controlled by self-organising networks, with an open decision making process.
Scandinavia is one of the largest producers of hydropower in the world.

Hydropower in Scandinavia

Sweden

National governments in Scandinavia consult with all stakeholders affected by hydropower plants. The interaction between stakeholders on hydropower projects in Norway can be classified as participatory governance. After the Scandinavian countries de-regulated their markets, they connected their individual markets into one common market, Nord Pool Spot. The energy that is not traded through the market is traded through contracts between suppliers, retailers and consumers.

Sweden

The Swedish electricity market was deregulated in 1996, transforming the industry from a government hierarchical system to a governance steering structure. The law stated that ‘power trading and network operations may not be conducted by the same organisation but numerous organisations thus the production and trade of electricity became competitive. The industry would be regulated by public authorities, the Energy Market Inspectorate within the Swedish Energy Agency. Its responsibilities included monitoring network tariffs and ensuring that network operators do not subsidise other interests.

Denmark

Most of Denmark's hydropower electricity comes from Norway and Sweden, supplied partly through Nord Pool Spot.
Denmark has increased its renewable energy sources from approximately 0% in 1970 to 20% in 2005, which leaves them on target for the RES directive. Wind share was 39% in 2014.

Norway

The different levels of governance in Norway concerning hydropower can be seen through the economic interests, and the social responses, to the installation and expansion of hydropower projects.

Local level

At the local level hydropower can have an enormous effect on communities; creating employment, improving infrastructure, and building new or enhanced roads. However, some communities can be resistant to hydropower, especially when local incomes are dependent on tourism. For example, fishing is an important recreational sport in Norway; and hydropower may prevent local people from participating. Also the installation of hydropower upon historic sites, and areas of natural beauty, is other major concern. Local communities have been known to bring in NGO's such as WWF Norway, or Friends of the Earth, in order to resist the installation of hydropower plants.

Regional

The municipality's response to hydropower typically represents the response of local communities. Municipality must manage the concerns of the stakeholder's communities, energy companies and NGO's regarding the installation of hydropower plants.
Various municipalities have shares and direct ownership of hydropower companies. Energy companies rely on municipalities to provide information on the local environment, and cooperate to create environmental impact assessments. This can involve numerous municipalities, as the watercourse may flow through several municipalities, and therefore are bound by regulations to work together on hydropower projects.
Hydropower companies pay fees to the local municipalities in the form of taxes and license fees. Smaller hydropower plants are exempt from taxes in order to economically stimulate local development. The Norwegian Water Resources and Energy Directorate determines the license fees paid to municipalities by hydropower companies. The NVE assess various factors such as degree of environmental disturbance and the profitability of the project.

National level

Hydropower has long been "associated with a nation-building process, representing the key infrastructure for economic growth and welfare, through electrification".
In 1991 Norway de-regulated its market and these institutions became the network for governing hydropower in Norway: