Can Hydropower Reduce the Transitional Climate Risk of Norway?

In this master thesis I will investigate the claim that hydropower can reduces the transitional climate risk of the Norwegian economy. I find that there could be gains from looking at a broader portfolio of the national wealth when assessing Norway’s climate risk. I also find that’s plausible stricter climate policies increase the value of hydropower while it decreases the value of petroleum. However, this depends on the policies that are implemented in Europe. Finally, I find that this change in value could affect the optimal regulation of the petroleum and hydropower sector and that it could be optimal to reallocate some capital from the petroleum to the hydropower sector