Energy and Climate Change | Streamlining of licensing procedures for larger power lines and hydropower facilities

On 29 August 2025, the Norwegian Government amended regulations with a view to simplifying and streamlining administrative procedures for larger power lines and large-scale hydropower facilities. The aim is to reduce processing time for licenses and contribute to faster development of necessary energy infrastructure, which is critical for meeting the needs of electrification and the green transition. By streamlining administrative processes and reducing bureaucratic bottlenecks, the reforms seek to accelerate the construction of essential transmission infrastructure needed to support Norway's electrification goals. The changes are particularly critical given that inadequate grid capacity has become a constraint for industrial and commercial operators seeking to establish new operations. Through simplified licensing procedures for both power lines and hydropower facilities, the Government aims to reduce processing times and enable faster deployment of renewable energy infrastructure. These measures represent an effort to modernize Norway's energy regulatory framework and ensure that administrative procedures keep pace with the urgent need for expanded energy capacity.

For larger power lines specifically, the requirement for external quality assurance and regulatory review of concept selection studies in the transmission grid will be discontinued, as it only affected a limited number of cases and possibly creating lengthier lead times for building transmission grid facilities. The authority to make decisions on licenses under the Energy Act for such facilities is transferred to the Norwegian Water Resources and Energy Directorate, rather than the King in Council, enabling a formal right of appeal.

Furthermore, delegation of decision-making authority in hydropower cases will simplify the processing of licenses by removing unnecessary duplication and bringing the process in line with the processes of other renewable energy production. This aims to establish consistent licensing procedures across energy sectors, ensuring that solar, wind, and hydropower projects follow similar administrative pathways. Under this arrangement, NVE will issue initial licensing decisions, including development licenses, while the Ministry of Energy will handle any appeals or objections. The delegation, including further delegation to NVE, entails a streamlining of the licensing process across technologies.

Discontinuing the requirement for external quality assurance and regulatory review of concept selection studies

Background

All electrical installations with a voltage above 22 kV require a license under the Energy Act (Norwegian: Energiloven). Furthermore, for all new grid facilities with a voltage of at least 47 kV, a concept selection study (“KVU”) must be carried out in accordance with the Regulations on Energy Studies (Norwegian: Forskrift om energiutredninger) before the project developer can commence the actual licensing process by notifying Norwegian Water Resources and Energy Directorate (“NVE”) of the project. This requirement has now been significantly simplified for the largest facilities.

According to section 9 of the Regulations on Energy Studies, the project developer must carry out a concept selection study for new grid facilities with a voltage of at least 47 kV before notification and application for a license under the Energy Act. A concept selection study is a professional study of various concepts that may solve a defined problem or need, including a socio-economic analysis of the various concepts. The KVU must comply with recognized methods for socio-economic analysis.

KVU scheme for larger power lines

For the largest power lines with a voltage of at least 300 kV and a length of at least 20 km, there are requirements for external quality assurance and regulatory review of the KVU. The requirements are set out in the External Quality Assurance and Decision-Making Authority Regulation (Norwegian: Forskrift om ekstern kvalitetssikring og vedtaksmyndighet etter energiloven). The process of external quality assurance and regulatory review of the KVU is often referred to as the KVU scheme. This will in practice only affect Statnett, which owns and operates the power lines in the transmission grid.

The KVU scheme was introduced in 2013 with the purpose of ensuring early political involvement, strengthening the energy authorities’ control over concept selection, highlighting the need for measures and the chosen concept, and ensuring the professional quality of the decision-making basis in the largest power line cases. Since its introduction, the Ministry of Energy has processed and commented on six KVUs and granted two exemptions. Two feasibility studies were under consideration as of 20 August 2025. The processing time in the Ministry of Energy has ranged from 7-18 months. These cases constitute a limited portion of the cases processed by the Ministry and NVE.

The KVU scheme sets out several process requirements to be completed before the license process for new, large power lines may commence. Statnett must first conduct a feasibility study. This study must be externally quality assured. The feasibility study and quality assurance report are subsequently submitted to the Ministry of Energy for a process-leading statement on the need for measures and the recommended concept. The Ministry of Energy submits the feasibility study and quality assurance report for public consultation and simultaneously obtains an assessment from NVE.

Rationale for discontinuing the KVU scheme

As mentioned, only a limited number of cases have been covered by the KVU scheme since its introduction in 2013. One consequence of this is that it is not possible to draw clear conclusions regarding how the KVU scheme affects the lead time for licensing processes, particularly for larger power lines. However, the Ministry is of the opinion that it is possible to achieve sufficiently good clarification of needs and concepts prior to the license phase through simpler and less resource-intensive processes in accordance with the requirements of the Energy Studies Regulation. Pursuant to the Energy Studies Regulation, NVE may review the feasibility study, but this will not be as detailed and comprehensive as under the current system of external quality assurance and regulatory review.

Discontinuing the KVU scheme also means there will no longer be a formal hearing of the concept selection study. This may result in time savings but may also mean that overarching questions about the need for measures and selected concepts will become a more prominent topic in the licensing process itself. Furthermore, the Government will also lose the opportunity to stop a measure in an early phase, beyond the provision in section 2-1, second paragraph regarding early case dismissal.

Decision making authority for larger power lines

Currently, NVE submits a recommendation to the Ministry of Energy, which prepares the case for the King in Council. These decisions cannot be appealed. The authority under the Energy Act to make decisions on licenses for new, large power lines will be transferred from the King in Council to the Ministry, and these power lines will thus be covered by the general delegation of authority from the Ministry to NVE.

This means that the system in which NVE makes first-instance decisions, and the Ministry serves as the appeal body will apply to new, large power line facilities, in the same way as other grid facilities that require a license. NVE will make a decision rather than a recommendation, thus introducing a formal right of appeal.

Parallel changes for licenses relating to hydropower

Background

Concurrently with the changes to power lines, important changes were also adopted for hydropower licenses, streamlining the licensing procedure relating to the Watercourse Regulation Act (Norwegian: Vassdragsreguleringsloven), the Waterfall Rights Act (Norwegian: Vannfallrettighetsloven) and the Water Resources Act (Norwegian: Vannressursloven). The resolution delegates the King in Council authority under three Norwegian water laws to the Ministry of Energy and outlines a reform to streamline hydropower licensing processes.

Key delegations relating to hydropower licenses

The King in Council’s authority to grant licenses for hydropower under the Watercourse Regulation Act will be delegated to the Ministry of Energy. The Ministry will then further delegate relevant authority to NVE through a separate decision, with legal basis either directly in the law or in the royal decree. NVE will be granted comprehensive authority to handle first-instance decisions, with limited exceptions for cases requiring parliamentary consent or municipal approval.

One key delegation includes the authority for the Ministry of Energy to grant licenses for the production of electrical energy that increase hydropower by at least 500 natural horsepower and/or by at least 3,000 natural horsepower in the entire watercourse and/or that have a “significant” impact on natural conditions or other public interests. In practice, the thresholds established in these provisions are low so that even smaller developments, including plan changes and changes in license conditions, must be processed through three administrative levels under the current system. Given that Norway’s large-scale hydropower potential has already been largely exploited, the new streamlined procedures will primarily benefit smaller projects and modifications to existing installations.

Authority to grant water rights licenses in accordance with the Water Rights Act section 2 first section will be delegated to the Ministry of Energy. The Ministry of Energy will process the licenses, instead of the King in Council. NVE will only process licenses for waterfall Rights if it is necessary for processing licenses in accordance with the Water Resources Act and the Watercourse Regulation Act.

The Ministry will also process license applications in accordance with section 8 of the Water Resource Act license for power development with installed capacity exceeding 10,000 kW and regulations exceeding 500 natural horsepower. The Ministry may then further delegate relevant authority to NVE, meaning the Ministry will handle appeals or objections.