5. Norway

Norway aims to become a low-emission society by 2050 with a targeted emission reduction of 90-95%, compared to 1990 levels (Ministry of Climate and Environment, 2021). The effect of Norway’s participation in the EU Emissions Trading System (EU ETS) is to be taken into account when assessing progress towards this target (Nordic Council of Ministers, 2023). Norway has also set a target of at least 55% GHG emission reduction by 2030, compared to 1990. The targets for 2030 and 2050 are enshrined in the Norwegian Climate Act, enacted in 2017, which requires the government to submit updated climate targets to the Norwegian Parliament every five years.

In its latest NDC, submitted in November 2022, Norway pledged its intention to collaborate with the EU, its Member States and Iceland to collectively reduce GHG emissions by 55% by 2030, compared to 1990 (UNFCCC, 2022). This entails reducing emissions covered by the EU Effort Sharing Regulation, spanning sectors such as road transport, fisheries, agriculture, and waste management, by at least 40% by 2030, compared to 2005. This target is expected to be increased to 50% (Nordic Council of Ministers, 2023).

In January 2021, the Norwegian government set out a comprehensive climate action plan, covering all sectors, to meet Norway’s climate targets while also promoting green growth (Ministry of Climate and Environment, 2021). Under the Climate Act, the government must make an annual report to the Norwegian Parliament (Stortinget) on the progress and implementation of the codified climate targets.

In relation to Norway’s ratification of the Paris Agreement in 2016, the Norwegian Parliament declared its intention to advance its previous 2050 carbon neutrality target to the year 2030 (Norwegian Parliament, 2016). Now referred to as climate neutrality, this target covers all remaining GHG emissions in Norway from 2030 onwards, although the specific role of the LULUCF is yet to be determined (Nordic Council of Ministers, 2023). To achieve climate neutrality, Norway will partly rely on international mitigation action, including participation in the EU ETS, international cooperation on emission reductions, emissions trading, and project-based cooperation (Ministry of Climate and Environment, 2021).

In 2023, the Norwegian government launched an initiative to establish partnerships with industry sectors responsible for the largest share of Norway’s GHG emissions and having the greatest potential for reducing emissions (Norwegian Government, 2023). The initiative, which involves the Minister of Climate and Environment and the Minister of Trade and Industry, along with key employer and employee organizations, aims to create mutually binding, industry-specific agreements between the government and selected business sectors. These agreements will formalize a collective vision for achieving Norway’s climate targets (Ministry of Climate and Environment, 2023).

Over the past decade, some private sectors in Norway have already pursued public-private partnerships to accelerate climate action. This has included pilot projects in maritime and land transport industries, intended to promote the exchange of knowledge and experience to overcome barriers and reduce risks for businesses (Ministry of Climate and Environment, 2021). Additionally, various sectors have developed their own roadmaps for green competitiveness, outlining emission reduction goals by 2050 while simultaneously aiming to increase value creation and job growth (UNFCCC, 2020). The government’s 2023 initiative to adopt industry-specific agreements builds on these earlier endeavors, aiming to further formalize and strengthen public-private collaborations (Interviews, Norway).

The main objectives of developing climate partnerships were introduced through a government roadmap known as the Green Industrial Initiative, published in 2022 (Ministry of Trade, Industry and Fisheries, 2022). The roadmap aims to accelerate the green transition within the business sector, emphasizing the potential of climate partnerships to foster a shared understanding between the public and private sectors of the actions necessary to achieve Norway’s climate goals. It was further noted that these partnerships would identify and anchor essential emission reduction strategies and the green transition in industry, including energy and resource efficiency and increased circularity.

Further, climate partnerships are intended to facilitate a systematic exchange of experience regarding the effect of policy instruments, without limiting the government’s overall scope for action in climate policy (Ministry of Trade, Industry and Fisheries, 2022). Subsequently, in January 2023, an agreement (referred to below as the ’general agreement’) was announced between the government and key industry actors in the Norwegian economy. The general agreement laid down objectives, overarching guidelines, and shared principles for collaboration (Norwegian Government, 2023).

Under the general agreement, the overarching goal of the climate partnerships is to enable socio-economically profitable business measures that contribute to reducing GHG emissions in Norway in line with the country’s climate targets for 2030 and 2050 and its broader economic transition goals (Norwegian Government, 2023a).

To achieve this goal, sector-specific partnership agreements are to be negotiated with selected sectors in order to facilitate structured dialogues. These agreements will be based on objectives outlined in the general agreement and will aim to create a common understanding among parties regarding necessary emission reductions within each participating sector. They are also intended to support competence-building and knowledge-sharing, including the sharing of information concerning the effects of various instruments of policy such as taxation, regulation, government support schemes, and development of infrastructure for transport and energy.

Furthermore, the purpose of the partnership agreements is to identify within each industry sector actual and potential measures to contribute to the green transition, focusing on areas such as energy and resource efficiency and the circular economy. Ultimately, the partnerships are expected to drive sustainable value creation, enhance the competitiveness of Norwegian business, promote the export of green products within international value chains, and ensure a fair transition towards carbon neutrality.

The parties to the general agreement are the State of Norway, represented by the Ministry of Climate and Environment and the Ministry of Trade, Industry and Fisheries, and key business organizations in Norway. Three sectors are chosen as pilot projects due to their substantial impact on total GHG emissions in Norway and their considerable potential for emissions reduction (Interviews, Norway). These three sectors are the process industry, the maritime industry, and the construction and property industry.

As part of this ongoing process, the collaboration’s coverage might gradually expand over time as other sectors may be invited to enter into climate partnership agreements with the government (Interviews, Norway).

Building upon the general agreement, negotiations began between the government and the selected sectors in order to formulate more specific agreements with each of the sectors involved. Originally intended to be completed by the end of 2023, this process has encountered delays and remains ongoing (Interviews, Norway).

It was clear from the beginning that the collaboration would not be as rigidly structured as in some other Nordic countries, and that there would be no specific government organization with a mandate dedicated to this effort (Interviews, Norway). Oversight and overall responsibility for the climate partnership agreements lie with the Ministry of Climate and Environment and the Ministry of Trade, Industry and Fisheries. The roles of key participants and the procedural steps leading to the conclusion of industry-specific climate partnership agreements are outlined in the general agreement (Norwegian Government, 2023a).

The partnership agreements will be adopted between the relevant sector ministry, the Ministry of Climate and the Environment, and invited organizations representing employers and employees (Ministry of Trade, Industry and Fisheries, 2022). Other ministries and individual companies may also become parties to the agreement. The selection of organizations is made by the relevant sector ministry in consultation with the Ministry of Climate and the Environment, with input from the relevant sector (Norwegian Government, 2023a).

Upon invitation to engage in a dialogue regarding a climate partnership agreement, the parties involved were expected to compile a knowledge base detailing efficacious and cost-effective measures that contribute to reducing GHG emissions and/or expedite a green transition along the entire value chain, along with the potential impacts of these measures. The knowledge base is to serve as the foundation for subsequent discussions focusing on implementing these measures. The process for compiling a knowledge base is to be further clarified within the industry-specific climate partnerships. Existing roadmaps or similar plans outlining the green transition within an industry are to be systematically reviewed, with a focus on identifying measures yet to be implemented (Norwegian Government, 2023a).

Under the general agreement, the parties must regularly evaluate the collaboration’s results and are required to meet at least annually to assess the impact of the partnerships. The parties must collectively decide how the climate partnerships will be followed up, for example by developing reporting procedures and by conducting periodic reviews to evaluate their progress and outcomes.

As of the writing of this report, the climate partnerships agreements are still in their preparatory phases, making it premature to discuss actual outcomes. However, it should be noted that the general agreement outlines a set of essential elements that must be incorporated into the agreements. These elements include the industry’s own targets and ambitions to reduce emissions and otherwise contribute to the green transition, ideally with clear, quantified targets and timetables. The agreements are to detail the measures intended to achieve these objectives and should also assess their potential distributional effects, with a particular emphasis on ensuring a fair transition. Furthermore, they should specify how work within the relevant sector will be organized and how progress will be monitored (Norwegian Government, 2023a).

As the Climate Partnerships initiative is still in its early stages, it is too soon to address the question of whether it will achieve its intended objectives. However, based on feedback from informants (notably fewer in Norway than in the other countries), the experience of the collaboration thus far has been both positive and challenging.

On the positive side, informants highlighted the significant value of establishing a shared vision between the government and the relevant industry sectors. It was noted that negotiations have generally been constructive, and optimism about their eventual finalization seems to remain. Progress was also noted in assembling a knowledge base, including defining data and metrics for establishing baselines and targets, as well as determining reference years. Informants underscored that the platform for knowledge and information sharing is among the most important outcomes of the cooperation so far.

There is evidently strong commitment on both sides to complete the agreements, and trust between the public and private sectors appears to be relatively high. Representatives from the private sector have emphasized their dedication to climate action and their willingness to contribute to Norway’s climate targets. According to a private sector informant, they recognize the importance of early adoption of ambitious climate measures for gaining a competitive advantage, particularly considering the European developments driving this transition.

On the negative side, however, feedback from the private sector indicates some dissatisfaction with the government’s perceived slow and hesitant approach, particularly in providing adequate financial and regulatory support for the significant steps required to achieve Norway’s climate targets. Some industry sectors have articulated specific demands for government facilitation of major advancement within industry sectors, for instance advocating for the establishment of a fund financed by revenues from the EU ETS. Different views on the financing of necessary measures have reportedly led to setbacks and delays in agreement negotiations.

Furthermore, private sector representatives have voiced criticism about a lack of clarity in the general agreement as to how to achieve goals and implement necessary measures. One informant suggested that the general agreement should have been more specific as to expectations, the structure of sector-specific agreements, and the apportioning of responsibilities between the government and the private sector.