Å Energi has awarded supplier contracts worth around NOK 1bn (approximately US$95m) for the construction of the Øygard hydropower plant in Åseral, Norway, with the company highlighting significant economic ripple effects at local, regional and national levels during the build-out to 2029.
The Øygard scheme marks the final stage of a wider hydropower development programme in Åseral that began in 2016. The programme includes new generating capacity, upgrades to existing plants and new dam infrastructure, bringing total investment to more than NOK 3.5bn (approximately US$330m) –one of Norway’s largest hydropower developments in the past 25 years.
The new plant is expected to increase renewable generation and strengthen system reliability, while also supporting economic activity across multiple sectors.
“Investments in increased hydropower production contribute to a more robust energy system and facilitate local and regional value creation, which is very positive. Up to 2035, we are planning investments in hydropower and the power grid for around NOK 35bn,” said Jan Erik Eldor, Executive Vice President of Å Energi Vannkraft.
“The work at Øygard power plant will provide activities in everything from construction and civil engineering, transport and service to accommodation and trade. Long-term plans also provide predictability that makes it possible for suppliers to invest in both capacity and jobs, investments in people and expertise,” Eldor added.
Economic impact
According to an analysis by Menon Economics, Å Energi’s activities generated total value creation of NOK 10bn (approximately US$950m) in 2024, supported nearly 4,300 jobs and contributed close to NOK 5bn (approximately US$475m) in public revenues through taxes and fees.
At the municipal level, the company’s activity accounted for more than 5% of private employment in Åseral in 2014 and around 2% in Kristiansand. Additional economic effects are expected during the construction phase of Øygard.
“These are important projects for Åseral and for Å Energi. The work on completing the tunnel and Øygard power plant will both produce power, create activity locally and have a number of ripple effects. We look forward to the first salvo. We wish construction workers, employees from Å Energi and others who will work on the project good luck with their work and hope you have a nice construction period here in the village,” said Inger Lise Lund Stulien, Mayor of Åseral.
Construction and contracts
Construction is scheduled to begin shortly after Easter. Norwegian contractor Veidekke has been awarded the main civil works contract, including construction of the power station and transfer tunnel from Langevatn.
“We are very pleased to have won the competition for the last stage of the power development in Åseral, and are looking forward to starting the work. We will now sign agreements with subcontractors, before we break ground sometime after Easter,” said Neal Nordahl, Director at Veidekke Anlegg.
Key equipment suppliers include Aker Solutions, which will deliver turbine, mechanical and electromechanical systems as well as control systems. Andritz Hydro (Germany) will supply waterway gates and hatches, while Indar will deliver the generator. Nettpartner will construct a 132 kV grid connection.
Project details
The Øygard plant will have an installed capacity of 18.5MW and is expected to generate enough electricity to supply around 5,000 homes.
Once completed, Å Energi’s total annual production in Åseral will reach approximately 1,400 GWh, equivalent to around 4% of electricity consumption in southern Norway (NO2).
The project forms part of Å Energi’s broader investment plan of approximately NOK 35bn (approximately US$3.3bn) in hydropower and grid infrastructure across Agder and Buskerud through 2035.
