Page 64 - European Energy Innovation - summer 2018 publication

64 Summer 2018 European Energy Innovation

SWEDEN ENERGY

Sweden on the route to
100 percent renewables

By Anne Vadasz Nilsson, Director General, The Swedish Energy Markets Inspectorate

After a broad political agreement, Sweden has set an ambitious target of 100 percent
renewable electricity production by 2040. Sweden’s tradition of combining good governance,
regulation, well-functioning markets and innovation for fast-tracking progress in new or
demanding areas will be vital for this undertaking. We are convinced that demand side flexibility
and efficient and interconnected markets are key components for a successful transformation
of the energy system.

Sweden is well endowed electricity production and therefore wind conditions and abundance of
with hydro resources, with most of the renewable expansion sparsely populated areas have also
the bulk of hydro power will come through solar and wind, contributed to the development.
plants installed in the sources that are inherently volatile Recently the Swedish Parliament has
first half of the 20th century. Today, in their electricity output. This is decided to increase and extend the
most of the rivers and streams are a notable change in the Swedish certificate scheme with an extra 18
dammed and controlled and there energy landscape that for decades TWh until 2030. This will set Sweden
is a broad political agreement not to has relied on hydro and nuclear even more on the route towards
exploit the remaining rivers. Hence, power production. Some of the 2040 and the 100 percent target.
only limited hydro resources remain increased volatility can be managed
to bolster the expansion of renewable with existing hydro resources, but ENERGY-ONLY
more solar and wind will nonetheless Since 1996 Sweden has had a
Photo: Robin Thunholm, Happify create a more variable power supply. well-functioning wholesale market
Contrary to controllable sources, model for the pricing of electricity
this supply is not price sensitive as and prices reflect supply and
it produces electricity when the sun demand. The energy-only model
is shining or the wind is blowing, not in combination with Sweden’s four
when prices are high. bidding zones have been of utmost
importance in ensuring the right price
In addition, the political push signals for the efficient allocation of
towards renewable electricity power production and transmission.
production and other global actions Furthermore, we have a strong
for a more sustainable energy linkage between the wholesale
future have contributed to reducing prices and the retail market. Swedish
the profitability of nuclear, and in customers are among the most
Sweden, this has resulted in the active in Europe and tend to make
decommissioning or moth balling informed choices based on market
of reactors. Instead wind power signals. The existing market model
has increased and especially large- has served Sweden well and will be
scale wind has shown a substantial critically important for reaching the
growth over the past years. This is political goals. In addition, the green
mostly due to the green certificate certificate support scheme has been
system - a common Swedish and implemented in a market based way,
Norwegian support scheme - but which has minimized the detrimental
also the result of shrinking variable effects subsidies can have on market
costs for renewables. Sweden’s good efficiency.

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