A controversial issue in the work on the new Minerals Act, which will enter into force on July 1, 2026, was whether measures that are permitted under energy and watercourse legislation also require a permit (license) under the Minerals Act if the measure involves the extraction of rock masses.
The conclusion was that, as a general rule, this type of measure requires a license under the Mineral Act. The practical implications of this for power producers in the future will largely depend on the specific regulatory provisions.
Background
The background to this issue is that a large amount of rock is often required when implementing measures that require a permit under energy and watercourse legislation, such as the development and improvement of reservoirs and the development of wind power. For such projects, it is usually most appropriate to use rock masses from areas close to the project site. For example, when constructing or upgrading a dam high up in the mountains, it will usually be more resource-efficient to obtain rock masses from a quarry close to the dam than to transport the rock masses from elsewhere. In some cases, for practical reasons, it will also be absolutely necessary to obtain the masses from nearby quarries.
Under the current Minerals Act, which came into force on January 1, 2010, it has varied over the years whether the extraction of rock masses for measures that are permitted under energy and watercourse legislation requires a separate permit under the Minerals Act.
Until around 2018, the administrative practice was that no license was required under the Mineral Act to extract and use masses from the planning area for measures permitted under energy and watercourse legislation. The view was that the considerations to be taken into account under the Mineral Act would be adequately addressed by the energy authorities’ processing of the permit for the project.
Around 2018, this practice changed. The Directorate of Mineral Management began to introduce requirements for a license under the Mineral Act also for the extraction of masses from the planning area for measures permitted under energy and watercourse legislation. The decisive assessment criterion under the changed practice was whether the masses were extracted to make the ground area available for other uses (e.g., extraction of masses to clear space for a road), or whether the masses were extracted for use elsewhere (e.g., extraction of masses to establish a dam in the immediate vicinity). If the ground area for the extraction was not to be used, the extraction was considered subject to a license under the Mineral Act.
The consequence of the changed administrative practice was that power companies had to spend extra resources on obtaining and handling concessions under the Mineral Act, even though both the measure itself and the associated mass extraction had been approved by the energy authorities. Many power companies found that the change in practice led to unnecessary duplication of work and use of resources for both the companies and the administration.
Discussions during the legislative process
Following the change in practice, both power producers and the NVE have argued that the requirement for a license under the Mineral Act is unnecessarily resource-intensive and hinders the development and upgrading of renewable power production.
Nevertheless, both the Mineral Law Committee’s report on the new Mineral Law (NOU 2022:8) and the Ministry of Trade, Industry and Fisheries’ proposal to the Storting (Prop. 71 L (2024-2025)) proposed continuing the changed practice from 2018 in the new Mineral Law. However, the proposal allowed for exceptions to the main rule on licensing requirements to be made in regulations.
During this spring’s hearing on the new Mineral Act, Renewable Norway emphasized on behalf of the industry that the work on the new Mineral Act was a good opportunity to simplify and shorten the processing time for renewable energy projects. Fornybar Norge primarily proposed that energy projects with permits under energy and watercourse legislation should be exempted from the scope of the Mineral Act, as was the practice until 2018, or that such projects should be exempted from the licensing requirement. Alternatively, Fornybar Norge proposed that the processing of any license requirements under the Mineral Act should be coordinated with the NVE’s detailed planning process.
The legal situation in the new Minerals Act
Renewable Norway’s primary proposal has not yet been incorporated into the new Minerals Act.
The starting point in the new Act is that all extraction of mineral deposits exceeding 10,000 m3 requires a license under the Minerals Act, cf. Section 6-2, first paragraph. Exceptions to this apply to the extraction of minerals that “mainly takes place as part of the preparation for other use of the land area where the masses are extracted,” cf. Section 1-2, second paragraph. In the special comments to the provision in Prop. 71 L (2024-2025), it is stated that the extractions covered by this exception are the same as before.
This means that a license is required under the Mineral Act even for measures that are permitted under energy and watercourse legislation – unless the extraction is mainly carried out as part of preparations for other use of the land area. In practice, therefore, a license under the Minerals Act will be required for a large number of projects that are permitted under energy and watercourse legislation.
However, the legislature has allowed the Ministry to grant exemptions from the licensing requirement pursuant to Section 6-11(b). Furthermore, the legislature has sought to mitigate the problems that a licensing requirement may entail by enshrining in law a requirement for coordination of case processing. It now follows from Section 1-8, first paragraph, that processes for processing plans and applications for permits required for mineral activities shall be coordinated in an “effective and appropriate manner.”
Section 1-8, third paragraph, stipulates that the Ministry may issue regulations on the implementation of such coordination. No such regulations have been issued as yet, and the preparatory work provides only limited guidelines on the content of the regulations.
Summary – an advantage or disadvantage for renewable power production?
The practical significance for power producers of the legislature’s decision to continue the administrative practice from after 2018 instead of returning to the solution that followed from the practice before 2018 will largely depend on whether the ministry grants exemptions from the licensing requirement in its regulations, and on how the regulations on the implementation of coordination pursuant to Section 1-8 are formulated.
If the Ministry grants exemptions from the licensing requirement and/or the permit process under energy legislation is coordinated effectively with the licensing process under the Mineral Act, the general rule requiring a license under the Mineral Act will not lead to significantly longer or more resource-intensive case processing procedures.
If, on the other hand, the Ministry does not grant exemptions from the licensing requirement and the coordination process is not well designed, there is a significant risk that the new Mineral Act will lead to longer case processing times and unnecessary duplication of measures with permits under energy and watercourse legislation.
To prevent the new Mineral Act from becoming an obstacle to the development and upgrading of renewable energy production, it is therefore important that the ministry gets its upcoming regulatory measures right.
