Still great potential for renewables in the Nordic region

More information on this topic is presented in the PMR report:

During the 2000s, the influence of renewable energy sources, apart from hydroelectric capacity, has increased markedly in Sweden and Denmark. In both countries the upside momentum has been almost exclusively fuelled by wind power. In 2003, Sweden launched an Electricity Certificate System in order to boost the production of renewable electricity. The objective of the certificate system is to increase the production of renewable electricity with 25,000 GWh by year 2020 compared to 2002, and the target will most likely be exceeded. There was only a minor contribution from solar power in 2002 in Sweden. Furthermore, that year wind power production totalled only 608 GWh, whereas in 2015 wind farms generated around 16,300 GWh.

 

 

Construction in Scandinavian states

 

 

Additional boost for renewables in Sweden will be provided by the decisions to shut down four reactors at Ringhals and Oskarshamn NPPs by 2020, which were taken to a large extent as a result of the recent increase in the nuclear energy tax aimed at encouraging investment into renewable energy production. In 2015, 34% of electricity production in Sweden came from nuclear power.

Furthermore, the joint Swedish-Norwegian market for electricity certificates was founded on 1 January 2012 and extends to the end of 2035. Between 2012 and 2020, the two countries aim to expand their production of electricity from renewables by 26.4 TWh (13.2 TWh each). Between 2012 and 2015, Sweden succeeded in increasing its wind power production by about 10.2 TWh, although the increase for solar power production was less than 0.1 TWh. Today, there are around 3,100 wind turbines in Sweden.

Nevertheless, even though Sweden has expanded significantly its wind power capacity during the last decade, it is still Denmark the world’s leading user of wind power. Denmark generated 42.1% of its electricity consumption from wind turbines in 2015, the highest figure yet recorded worldwide. In 1990 wind power covered only 2% of the electricity consumption in Denmark.

Moreover, the Danish government has set an ambitious target for the further development of the energy industry, aiming to make Denmark self-reliant on renewable energy in 2050. In accordance with the Energy Agreement of 2012, through expanded offshore wind production and the use of biomass, renewables are expected to cover more than 70% of Danish electricity production by 2020. As for the wind power subgroup, the country’s wind turbine capacity is to be expanded to almost 7,000 MW in 2024, up from 4,900 MW in early 2015. In 2024, wind power generation is planned to make up for 61% of the Danish electricity consumption.

Norway has also established many records in the renewable energy market. Even though Norway is Western Europe's largest petroleum liquids producer, being a major supplier of crude oil and third largest exporter of natural gas, domestic electricity production is more than 97% based on renewable sources. Furthermore, Norway's exports of electricity surpassed imports in 2015: 22 TWh against 7.4 TWh.

 

Construction in Scandinavian states

 

Although almost all electricity generated in Norway is already based on renewables and exports of electricity have exceeded imports every year since 2011, the country’s authorities aim to continue to support the expansion of the country’s electric power generation capacity.

According to the joint Swedish-Norwegian electricity certificate scheme, producers of renewable electricity receive one certificate per MWh of electricity they produce for a period of 15 years. All renewable generation capacity that entered construction after 7 September 2009, and hydropower plants with an installed capacity of up to 1 MW that started construction after 1 January 2004, are entitled to electricity certificates. Generation units that will be activated after 31 December 2020 will not receive electricity certificates. It should be mentioned that all forms of renewable electricity are entitled to electricity certificates. Norway and Sweden agreed to finance half of the support scheme each, regardless of where the investments take place.

Finland has the lowest penetration of renewable power generation among all the Nordic countries. Altogether only around 40% of the electricity produced in Finland comes from renewable energy sources. Nevertheless, according to the National Renewable Energy Action Plan, in Finland the proportion of final energy consumption accounted for by renewable energy is to be increased from 28% in 2009 to 38% by 2020. Furthermore, the goal is to expand the share of renewable energy in the 2020s to more than 50%, to halve the consumption of imported oil for domestic purposes and to increase energy self-sufficiency to more than 55%. In 2016 the government is expected to amend the subsidy scheme for renewable energy. The goal of the improved subsidy scheme is to boost the proportion accounted for by emission-free renewable industrial-scale electricity production and co-production of electricity and heat.

 


More information on this topic is presented in the PMR report:
Construction sector in the Scandinavian states 2016. Market analysis and development forecasts for 2016-2021: Denmark, Finland, Norway, Sweden