Sweden's Future Electrical Grid

Home , NordBalt, Swedish Academy, Vattenfall

Sweden’s Future Electrical Grid A project report

IVA Electricity Crossroads project THE ROYAL SWEDISH ACADEMY OF ENGINEERING SCIENCES (IVA) is an independent academy whose mission is to promote the engineering and economic sciences and the advancement of business and industry. In cooperation with the business community and academia, IVA initiates and proposes measures to improve Sweden’s industrial expertise and competitiveness. For more information about IVA and the Academy’s projects, see the website www.iva.se.

Published by: The Royal Swedish Academy of Engineering Sciences (IVA), 2017 Box 5073, SE-102 42 Stockholm, Sweden Tel. +46 (0)8 791 29 00

IVA REPORTS: IVA publishes various types of reports within the framework of its activities. All reports are fact-checked by experts and then approved for publication by IVA’s President.

PROJECT REPORTS (IVA-M): A project report summarises a significant portion of a project. A project report can be a report generated during the course of a project or a final report produced at the end. A final report can be based on several project reports. Project reports contain fact-based analysis, observations and a discussion of consequences. Final reports contain clear conclusions and prioritised policy recommendations. Project reports are often the result of the work of a work group and contain limited conclusions and policy recommendations. The project Steering Committee approves all project reports for publication and they are fact-checked by IVA to guarantee their factual accuracy and quality.

IVA-M 477 ISSN: 1102-8254 ISBN: 978-91-7082-945-1

Authors: Anna Nordling, ÅF Project Manager: Jan Nordling, IVA Editor: Camilla Koebe, IVA Layout: Anna Lindberg & Pelle Isaksson, IVA

This report is available to download as a pdf file at IVA’s website www.iva.se Foreword

IVA’s Electricity Crossroads project has been examining what the electricity system might look like in the years 2030 to 2050 and what options are available. The project’s Electricity Distribution and Transmission work group was tasked with describing different scenarios for the future electrical grid within the framework of the project’s time perspective.

Answering the following questions has been the main focus for this project.

• What will the role of the electrical grid be in the energy system of the future? • What changes need to be made and what investments are needed to create the electrical grid of the future?

Results from previous project reports on electricity production and electricity use have been used to inform our analysis. This report will also be used as a source of information for the project and the continuing work of the Climate and Environment and the Public Finances and Electricity Market work groups, and for the project’s concluding synthesis work.

Stockholm, February 2016

Electricity Distribution and Transmission work group:

Alf Larsen, E.ON (Project Chairman) Anna Nordling, ÅF (Project Manager) Mikael Möller, IKEM Henrik Bergström, Ellevio Stefan Thorburn, ABB Tomas Kåberger, Chalmers University of Technology Asoos Rasool, Mälarenergi Magnus Olofsson, Energiforsk Karl Bergman, Vattenfall Ulla Sandborgh, Svenska kraftnät Mats Ählberg, Siemens Pär Hermeren, Teknikföretagen Anders Pettersson, Swedenergy

Contents

1. Conclusions and summary...... 7

2. Introduction...... 11

3. Future electricity use...... 15 Transport sector...... 15 Urbanisation...... 17 Future electricity Use in industry...... 17 Prosumers and local energy systems...... 17 User flexibility...... 18

4. Future electricity production...... 19 Connecting new production to the electrical grid...... 20 Future electricity production alternatives and their effect on the electrical grid...... 20 Production alternative “More solar and wind”...... 22 Production alternative “More bioenergy”...... 24 Production alternative “New nuclear power”...... 26 Production alternative “More hydropower”...... 28 Summary...... 30

5. Sweden’s level of self-sufficiency...... 31

6. Future delivery reliability requirements...... 33

7. Storage...... 35

8. EU influence...... 37

9. New investment in the electrical grid...... 39 Investments in local and regional grids...... 39 Investments in the national grid...... 41 Future investments with new conditions...... 41 The cost of the grid in relation to new production...... 42

10. Future price structures...... 43

11. Implementation times...... 47

12. Electrical grid technology...... 49

13. Appendix...... 53 6 1. Conclusions and summary

There are essentially two categories of electrical to EU guidelines with respect to grid codes, elec- grids: transmission grids and distribution grids. tricity export and import levels and Sweden’s But Sweden has divided the electrical grid into level of self-sufficiency. three categories: the national grid (transmission If there is a trend in the future whereby gen- grid), regional grids and local grids (distribution erated electricity increasingly flows from users grids). The transmission grid can be compared and into the grid, the role of the grid is expected to a motorway system where large amounts of to become more complex than it is today. The electric energy can be transferred over long dis- growth of so-called prosumers may lead to elec- tances with very small losses. The regional grid tricity users becoming self-sufficient and going can be compared to trunk roads where electric off-grid, which could affect the future role of the energy is distributed to cities and large towns. grid. Today society is already highly dependent Finally, the electricity is distributed to electric- on a reliable electricity supply and the conse- ity users via local grids (large users may also be quences of a power outage can be serious. There connected to the regional grid). may also be stricter regulation of the grid as the In Sweden today there are some 170 electrical consequences of outages become increasingly grid companies that own and operate local and serious in a society that is ever more dependent regional grids. There is strong municipal owner- on a reliable supply of electricity. ship as 129 of these are municipal companies. Changes are also taking place on the user The three largest grid companies (Vattenfall side. These changes may reduce the demand for Eldistribution, E.ON Elnät Sverige and Ellevio) power demand (devices, revolution control, user supply more than half of Sweden’s electricity flexibility) and increase power demand (electri- users with electricity. Sweden’s national grid fication of modes of transport, new or more de- is managed by the government agency and au- vices/equipment running on electricity). Energy thority Svenska kraftnät, which also has overall storage solutions may also impact grid design. responsibility for the entire Swedish electricity It may be necessary to reduce power demand system. through load control or increase it to receive the surplus from variable electricity production. All in all an increase in demand for flexible THE ROLE OF THE ELECTRICAL GRID solutions for the grid is seen. IN THE ENERGY SYSTEM OF THE FUTURE CHANGES TO THE ELECTRICAL The electrical grid has a fundamental role in GRID OF THE FUTURE Swedish society and is entirely critical in order for society to function. Since the electrical grid Electricity use links electricity production and use, the future Trends in electricity use that are affecting the production mix and the way electricity is used grid include urbanisation, changes in Swedish will influence how the electrical grid is devel- industry, an increase in the number of prosum- oped. The electrical grid must also be adapted ers, user flexibility and electrification in the

7 transport sector. Urbanisation is increasing grid in the different production alternatives is the pressure on the grid around and in cities. presented in Table 1. Depopulation means that grids in sparsely pop- The cost of adapting the electrical grid for the ulated areas are supplying fewer people, mak- different production alternatives is small com- ing electricity more expensive for the people pared to the costs for the various electricity gen- remaining in these areas. Similarly, a change in eration facilities. But developing the grid is by no the industrial structure could result in radical means a simple process; it is important to plan changes and thereby also significant changes to ahead. Efficient planning and permit processes the electrical grid. are also essential. In many cases, obtaining a Without control mechanisms or incentives, permit for new power lines takes longer than an electrified transportation will probably lead to expansion of, for example, wind power. There higher peak loads, and the challenges will affect are also significant differences in grid invest- local and regional grids the most. But by using ment needs for the different production alterna- control mechanisms and/or incentives, electric tives. The “More solar and wind” and “More vehicles could instead relieve the pressure on the bioenergy” alternatives in particular require electrical grid. changes to the electrical grid in the form of new User flexibility will not significantly impact cables or reinforcing existing infrastructure at the dimensions of the electrical grid, but con- the local, regional and transmission grid levels. stant and guaranteed user flexibility could help A general assessment needs to be made of the to reduce the need for more transmission capac- system cost for the different production alterna- ity. Local energy storage could, on the other tives and their effects on grid investments to de- hand, be a more significant factor when plan- termine what the consequences will be for elec- ning grid dimensions. Increased flexibility to tricity users, especially industrial players who avoid the need to increase grid capacity must, are exposed to global competition. The value of however, be related to what proportion of the an advanced electrical grid is the ability, at any total investment consists of materials (cable di- given moment, to take advantage of the cheapest mensions). Another aspect to consider is that production options in northern Europe. thicker cable dimensions results in lower grid The Swedish electricity system can handle losses. both the sudden loss of large production plants and of plants whose energy generation var- Electricity production ies depending on access to sun and wind. One The future electricity production mix will also important resource for the future is a supply of determine the design of the future electrical hydropower and reservoirs to help balance vari- grid. The amount of new production capacity ations over most timeframes – from seconds and that must be connected to different parts of the minutes up to months.

Table 1: Added electricity generation in the different production alternatives.

Added electricity generation (GW) Production alternative 1 – More Solar and Wind 26 Production alternative 2 – More Bioenergy 18 Production alternative 3 – New Nuclear Power 5 Production alternative 4 – More Hydropower 18

8 Electrical grid tariff options ONE Sweden price

Electrical grid Facilitates joint tariff options accounting within each company

Individualised grid costs

Most of the plants that contribute signifi- that power outages will be unacceptable and cantly to this balancing capacity are in north- that a power outage which occur will need to be ern Sweden. This, in combination with the large fixed faster, that electrical grids must be further wind farms that will be built in northern Swe- weather-proofed and that outage compensation den due to good land availability and favourable paid to customers will need to be raised. wind conditions, will increase the transmission User flexibility and an increase in the number capacity needs from northern to central Sweden, of prosumers may, on the other hand, change so-called electricity areas (elområden) 1 and 2, what is required in terms of delivery reliability or SE1 and SE2. in local and regional grids. Incentives for users may result in flexible delivery reliability for cer- Sweden’s level of self-sufficiency tain user groups. The extent to which Sweden is self-sufficient will have varying consequences depending on wheth- Stored energy er it is power or energy self-sufficiency, with self- Stored energy may benefit the system by, for sufficiency in power having a greater impact on example, relieving the pressure on local grids, the electrical grid. Both high and low levels of helping to maintain frequency stability and op- self-sufficiency will require more transmission timising production of all types of electricity capacity between Sweden and other countries. generation, stoppages, electricity quality etc. Storing energy locally may also lower what is Delivery reliability required in terms of delivery reliability and elec- Greater delivery reliability may be needed in the tricity quality. future for all types of grids. Today’s high-tech society is already dependent on electricity in or- Investments in the electrical grid der to function, and the cost of a loss of electric- The electrical grid is constantly being renewed ity will continue to increase in a society where and improved, partly through the replacement automation and digitisation are important of ageing equipment, but also by new producers development and growth areas. Increasing de- being connected and other changes in electric- mand for greater delivery reliability could meant ity use and electricity generation. Overhead lines

9 in local grids are, for example, being replaced Tariffs by underground cables so that the grid will be Grid costs could develop in two different direc- able to better withstand an increasing number tions, see the figure on page 9. of storms. With individualised grid tariffs, each custom- Regardless of the changes in the energy sys- er pays for its actual part of the grid, i.e. the tem, the big investment programmes will have a longer the power lines and the more complex clear focus on the electrical grids that are near- the geography, the more expensive the grid tariff ing the age of 50. Investments will be driven by will be. If grid charges are levelled out, the price a combination of the need to maintain delivery will be the same throughout Sweden for all elec- reliability and to increase capacity in regions trical grid companies (different for different grid with strong population growth or growth in customer categories). new types of electricity generation. The behaviour of grid companies is deter- Losses mined by the types of incentives that exist in the The main factors influencing the size of grid regulatory frameworks. Because the regulations losses are the length of the power lines/cables, are changed every four years to include differ- the cable dimensions and the phase angle different incentives, it is hard to determine whether ence between current and voltage. The losses are the grid is developing in the right way. A clear, in direct proportion to transmitted energy. An overarching political vision for regulation is re- increased percentage of local production would quired if the electrical grid is to be a facilitator mean energy being transmitted over a shorter for development of the whole system. distance before reaching the user, which could mean reduced losses in the local grid. On the Implementation times other hand, lower usage will increase the pres- Today’s permit processes create a bottleneck in sure to optimise the dimensions of the plants, many necessary change processes. The length and when capacity utilisation increases, so too of the permit process should at least be more will the losses. predictable. With the increasing importance of our large- Smaller facilities, such as solar panels and scale hydropower in the north, in three of the local energy storage, can be installed quickly four production alternatives the need for trans- compared to the multi-year processes when mission from north to south is greater as well, building large conventional power plants. The and there will be increasing losses unless trans- faster pace of change among producers short- mission capacity is expanded. ens the grid operators’ planning process horizon and increases the need for fast project planning and implementation, as well as fast processing of permits by the authorities. Another aspect is that the lifespan of these types of small plants is shorter than the life of electrical grid, which creates a discrepancy in the planning horizon.

10 2. Introduction

The electrical grid has a fundamental role in opment and how the electricity market of the Swedish society and is critical if society is to future is designed. Factors impacting Sweden’s function. Electricity is often produced far away future electrical grid are illustrated in Figure 1. from the place where it is needed and the grid is the infrastructure that enables transmission of electricity from electricity producers to electric- SWEDEN’S ELECTRICAL GRID ity consumers. The electrical grid gathers, transports and There are essentially two categories of electrical distributes electric energy to the places where grids: transmission grids and distribution grids. consumers want it. The grid enables many dif- But in Sweden the electrical grid is divided into ferent primary energy sources, such as different three categories: the national grid (transmis- types of fuel, hydropower, wind power and solar sion grid), region and local grids (distribution energy, to interact to provide the society with grids). The transmission grid can be compared energy, each with its own specific conditions. to a motorway system where large amounts of The electrical grid has a key function as a facil- electric energy can be transferred over long dis- itator for renewable energy generation as follows: tances with very small losses. The regional grids can be compared to trunk roads where electric • Renewable electricity generation which energy is distributed to cities and large towns. is tied to a particular location, such as Large electricity users are connected to this part hydropower, can be developed. of the grid. Finally the electricity is distributed • Renewable electricity production from wind to small electricity users through the local grids power can be located where the best conditions (Swedenergy, elnätet, 2016). exist from a production and environmental Figure 2 contains a diagram illustrating the perspective. different parts of Sweden’s electrical grid. • The power balance can be maintained and power reserves distributed. The national grid • Variable electricity production can be used The part of the electrical grid called the na- over large areas and “losses” can therefore be tional grid maintains a voltage of between 220 reduced or eliminated in the production phase. kV and 400 kV. The national grid is managed by the public enterprise and authority Svenska Since the electrical grid links electricity produc- kraftnät, which is responsible for the entire tion and use, the future electricity generation Swedish electricity system. This means that mix and future electricity use will influence how Svenska kraftnät is responsible for maintain- the electrical grid is developed. The grid must ing the balance between production and con- also be designed according to EU standards and sumption of electricity throughout the country. for the level of electricity exports and imports Responsibility for planning is delegated to a needed, i.e. Sweden’s level of self-sufficiency. number of companies who have undertaken to Other aspects that will affect how Sweden’s plan to ensure a balance is maintained within electrical grid develops are technological devel- their respective areas. Ensuring that sufficient

11 Figure 1: Factors impacting Sweden’s future electrical grid

Storage development Delivery EU reliability requirements

Sweden's self- Future tariff sufficiency level structure

Future Permit use process

Future Technical production development

electricity is produced to match the amount ity users. The power reserves must be available consumed in the country is the responsibility between 16 November and 15 March (Svenska of the electricity suppliers. Under the current kraftnät, balansansvar, 2015). Electricity Act, an electricity supplier is re- The national grid is dimensioned to transfer sponsible for supplying as much electricity as large quantities of electricity over long distanc- its customers consume hour by hour (Svenska es. It consists of 15,000 kilometres of cables, 160 kraftnät, balansansvar, 2015). The electricity switching stations and five international connec- suppliers may take on this responsibility them- tions with high voltage direct current (HVDC). selves or transfer it to another company. The national grid maintains a high voltage level, Sometimes there may be occasions where elec- 220 kV–400 kV, to minimise transmission loss- tricity consumption is expected to exceed the es. Large electricity generation plants feed elec- planned electricity generation. The resources tricity produced into the national grid. In order planned for by the companies responsible for for a plant to be able to be connected to the 220 maintaining the balance would, in such a case, kV grid a feed-in capacity of at least 100 MW is not be sufficient. Svenska kraftnät purchases required and at least 300 MW is needed to con- power reserves to be used in such situations. The nect to a 400 kV grid. Output from the national power reserves consist of contracts with various grid mainly flows to the regional grid, with the actors in the market such as electricity producers exception of the 220 kV ring in Stockholm with with reserve power plants or with large electric- is owned by Ellevio.

12 The regional grids electricity from the regional grids to the end cus- The regional grids usually maintain a voltage of tomers, such as homes and commercial prem- between 20 kV and 130 kV and connect the na- ises. Electricity from relatively small-scale elec- tional grid to the local grids, generation plants tricity generation is also fed into the local grid. (such as CHP, hydropower and wind power) and large electricity-intensive industries, such as pa- Electrical grid companies per mills, smelting plants, oil refineries, chemi- In Sweden today there are some 170 electrical industries and mines. Most of the Swedish cal grid companies that own and operate local regional grids are owned by the grid companies and regional grids. There is strong municipal E.ON Elnät Sverige, Vattenfall Eldistribution and ownership because 129 of these are municipal Ellevio. companies. The three largest grid companies, Vattenfall Eldistribution, E.ON Elnät Sverige The local grids and Ellevio, supply more than half of Sweden’s The local grids usually maintain a voltage of be- electricity users with electricity. tween 0.4 kV and 20 kV. The local grids transfer

Figure 2: Different parts of the electrical grid (Illustration: Henrik Båge, 2016)

13 BOUNDARIES on the scenarios described in the final reports from the Electricity Production and Electric- The Electricity Distribution and Transmission ity Usage work groups within the Electricity work group performed an analysis in 2015 based Crossroads project. Because the geographical on the information available to them at the time location of new electricity generation units will and on predictions about future technology. The greatly influence the way in which the electri- work group’s analysis does not include poten- cal grid is designed, the work group has chosen tial technology leaps for which they have had not to analyse the economic scope of each of the no information on which to base an assessment. production alternatives in detail. This analysis One significant technology leap that could revo- would contain too much uncertainty. Analysis lutionise the way the transmission system works of the grid’s development has also been based on is the emergence of superconductors. However, changes originating from new production plants the Electricity Distribution and Transmission built in Sweden and not on potential new pro- work group have determined that a technically duction in Norway, Finland or other European and financially justified introduction of super- countries. However, in the chapter on Sweden’s conductors is beyond the project’s time horizon. self-sufficiency, it is assumed that there will be Specific technical issues such as the importance an expansion of production in neighbouring of inertia in the electrical grid are covered in a countries if the exchange through international special separate study within the framework of connections increases. the Electricity Crossroads project. Specific tech- Market-related issues, including discussions nical developments, such as battery technology, on control mechanisms, are addressed by the are also described in more detail in an earlier Public Finances and the Electricity Market special project study. work group within the framework of the pro- The Electricity Distribution and Transmis- ject. sion work group’s assessment of the future electrical grid’s development needs is based

14 3. Future electricity use

The electrical grid of the future will be adapted to rect impact on the connected part of the grid, the way electricity is used in the future. Changes but since electricity fed into the grid is mainly in electricity use that affect the grid include ur- transported from the national grid and down in banisation, changes in Swedish industry, growth voltage levels, it will also have an effect on the of prosumers, user flexibility and electrification level above. of the transport sector. The overall assessment of Figure 3 shows an example of transmission the project’s Electricity Usage work group of elec- through the grid – from production to use. tricity use in the future is presented in Table 2. The dimensions of the electrical grid must be planned to handle the maximum load, i.e. for TRANSPORT SECTOR the maximum amount of being power drawn from the grid. The Electricity Usage work Electrification of the transport sector may result group has made the general assessment that the in more vehicles running on batteries and/or an amount of power drawn will vary depending on increase in the number of road vehicles that are how electricity is used. But large local variations supplied with a constant source of electricity by could occur here based, for example, on the geo- electrified roads. Electrification of roads would graphical location of electricity production and involve the construction of new electricity infra- use, electricity use trends etc. structure along the country’s roads, while growth Electricity users such as residential and the in the number of battery-driven cars will require service sector are connected to local grids, while an expansion of the charging infrastructure. larger industries are connected to regional grids. A sharp increase in modes of transport requir- No users are connected directly to the national ing charging infrastructure will result in higher grid. Changes in these sectors would have a di- peak loads, which means the capacity limits will

Table 2: Future electricity use (IVA, Future Electricity Use, A project report, 2016)

Today’s electricity use Estimated electricity use Sector 2013 [TWh] beyond 2030 [TWh] Households and services 71 65–85 Industry (including data centres) 51 50–60 Transportation 3 10 –16 Other electricity use 4 3–4 Total electricity use excluding grid losses 129 128–165 Total electricity use including grid losses 139 140–180

15 Figure 3: Outline sketch – from production to use through the electrical grid (Andersson, 2008)

Production Power substation Transmission Distribution Distribution Distribution Distribution Grid station Distribution Use substation substation

400 kV 400/70 kV 70 kV 70/10 kV 10 kV 10/0.4 kV 0.4 kV

Figure 4: Population centres that no longer exist* (left) (SCB, Det var en gång en tätort, 2016) and Sweden’s population density (right) (SCB, Varannan svensk bor nära havet, 2016)

Population density – number of residents per square kilometre in 2010 Kiruna

5,000 and above Dennewitz 150–5,000 Messaure Luleå 30–150 Laisvall 5–30

1–5 Umeå Östersund 0 Sundsvall

Gävle

Västerås Uppsala

Karlstad

Örebro

Kvarntorp

Stockholm Såtenäs Villastad Gothenburg Linköping

Kalmar Helsingborg

Malmö Växjö

* Population centres where the population has fallen below 200 people are shown with a yellow dot and those that no longer exist with a red dot. be exceeded in certain parts of the grid (ELFORSK, Sweden’s 290 municipalities (SCB, 2016). “Over Framtidens krav på elnätet, 2014). This is because the past 50 years more than 500 communities in without any control mechanisms or incentives, Sweden have ceased to be population centres. electric vehicles will probably be charged during This is either due to the population falling below Sweden’s peak load hours, i.e. early morning and 200 people or that the community has joined up late afternoon. Thus the introduction of electric with a larger population centre.” (SCB, 2016). vehicles could require more capacity during high 344 population centres have disappeared due to load periods (ELFORSK, Prosumer med Demand- a dwindling population. Population centres that Response, makroperspektivet, 2012). A positive have disappeared due to a fall in the population effect on the power demand could instead be in the period 1960–2010 are shown in Figure 4. achieved if electric vehicles are charged with sur- The map on the right shows what Sweden would plus electricity generated by, for example, wind look if mapped according to population size. power. In order for this to happen incentives are Urbanisation is increasing the pressure on the needed to encourage people to charge their ve- grid around and in cities. Depopulation means hicles when it benefits the electricity system the that grids in sparsely populated areas will be most. The challenge is expected to be highest in supplying fewer people with electricity which low and medium voltage grids (ELFORSK, Fram- will thus be more expensive for the people still tidens krav på elnätet, 2014). there. This could drive more users go off-grid Electric vehicles could function as small dis- and become self-sufficient. persed energy storage resources, and with smart Electric vehicles today are greatly over-repre- technology and control solutions, could poten- sented in population centres and this trend is tially serve as an aggregate energy source. The expected to continue for a long time. batteries in electric vehicles could be used as distribution units in the energy system by way of an aggregator or a so-called service broker (IVA, FUTURE ELECTRICITY USE IN INDUSTRY Energilagring, 2015). Development is moving fast towards electric Similar to the way urbanisation is affecting the vehicles having larger faster-charging batteries. electrical grid, a possible change in the way This trend could have a big impact on the future Swedish industry uses electricity would also electricity system. For example, there could be have an impact on the grid. There has been a rel- more flexibility in terms of when vehicles are atively even distribution of energy use in Swed- charged and their ability to share stored energy. ish industries across the different sectors. The Local, fast-charging solutions could also result expectation is that electricity use in industry in large amounts of power being drawn from the overall will be at the same level in 2030 as it is grid (today up to 150 kW for a single vehicle). today. An increase or decrease in electricity use in the different sectors would change the conditions in the grid, depending on where the indus- URBANISATION tries geographically increase or decrease their electricity consumption. Electricity intensive As is the case in large parts of the world, there is a industries exist today in much of the country. clear urbanisation trend in Sweden. The population growth is concentrated to Stockholm, Goth- enburg and Malmö and their suburbs, as well as PROSUMERS AND LOCAL other large cities. There are few indications today ENERGY SYSTEMS that this trend will decline. Statistics Sweden’s population forecasts indicate that the trend will Electricity users that start producing electricity continue at least until 2050, i.e. throughout the themselves are called prosumers because due to period that is the focus of Electricity Crossroads. the combination of being a produce and a con- The population is expected to decline in 206 of sumer. It is very likely that the number of pro-

17 sumers will increase in society and contribute to MW and how soon can it be repeated? The abil- growth in the amount of small-scale distributed ity of different parts of society to be flexible in production, see more on this in Chapter 4. their use varies. Cost alternatives vary as well. The emergence of prosumers means that the In each of the parts of the energy-intensive pro- electrical grid is used in a new way; electricity is cessing industry, the technical and economic not just being transmitted in one direction, con- possibilities to improve user flexibility vary as sumers are also feeding electricity back into the well. Common to all processing industries is, grid. The nature of the grid is therefore chang- however, the fact that frequently asking for using because this type of generation is intermit- ers to be flexible is not consistent with profitable tent and, in some cases, can be so large that the operation. net flow in the distribution network changes Increased flexibility can be used as a means direction (ELFORSK, Prosumer med Demand- to avoid or delay large investments in increased Response, makroperspektivet, 2012). grid capacity. Advances in energy efficiency, load control The potential estimated by the Electricity and battery technology, as well as new produc- Crossroads Electricity Usage work group is 4 tion technology, may result in consumers or lo- GW (2 GW from industry and 2 GW from private cal grids developing into self-sufficient units. use) of flexibility, which would not have a big If this were to happen, and grid customers in impact on the dimension of the electrical grid. a distribution grid were to be financially able Cable dimension savings should be related to to bridge the significant seasonal or day-to-day the total investment. A guideline for an invest- variations in sunlight and energy demand, the ment in cable is around 20–30 percent is ma- distribution grid will lose its value. The trans- terials and around 70–80 percent is excavation mission grid would then be used mainly to sup- work (digging). ply industries and some large cities. Sweden’s ex- In order to apply user flexibility in the grid port opportunities may still be substantial, but the capacity limits of the grid must also give the the transmission costs could increase per energy right price signals to the customers, and thereby unit and industries would potentially also need be a part of a future capacity market. Locally to rely more on local electricity production. stored energy has the potential to impact the Solar cells concentrated in a small area could amount of power being drawn from the grid to in cloudy conditions give rise to voltage varia- a greater extent than just user flexibility alone. tions of up to 20 percent on a minute-by-minute At the same time, stored energy could result in a basis. This problem could be reduced, however, more power being drawn from the grid because if several solar cells were to be connected to one of a need to accept the “surplus” from renewable grid over a larger area (ELFORSK, Prosumer med electricity generation. The same applies to bat- Demand-Response, makroperspektivet, 2012). teries in electric vehicles. This is a good illustration of how the grid func- User flexibility will not have a big impact on tions as a facilitator of renewable electricity pro- determining the dimensions of the electrical duction. grid. Constant and guaranteed user flexibility could help to reduce the amount of capacity needed and thereby reduce the amount of trans- USER FLEXIBILITY mission capacity needed. Local energy storage could, on the other hand, have a greater impact So-called user flexibility, i.e. that users change on the electrical grid dimensions. Increased flex- their electricity use patterns because of various ibility to avoid the need to increase grid capacity incentives, can be used to deal with peaks and must, however, be related to how large the share ensure a more even load. It is important how- of material (cable dimensions) is as a percentage ever, to consider sustainability and repeatabil- of the total investment, particularly in the case ity. How many hours at a time can electricity of local grids. consumption be reduced by 3,000 MW–4,500

18 4. Future electricity production

The current national grid was expanded in the local or small scale units cannot be expected. The 1950s to handle the expansion of hydropower, situation is different for solar energy because econ- and in the 1980s for nuclear power. It is therefore omies of scale at solar facilities are minor, i.e. a dimensioned for this type of large-scale energy small unit generates electricity for about the same generation. One key reason why large-scale gen- cost as a large one. Added to this is the fact that eration was chosen was the significant econo- the economic model is entirely different for a local mies of scale at the production facilities. Figure unit, such as solar cells on the roof of a building. 5 shows today’s electricity production broken With grid parity, i.e. that it is possible to produce down into the various generation sources. Hydro- power for a cost that is equal to the price of pur- power, which in 2014 accounted for 40 percent chasing power from the grid. Here, regulation and of all electricity production, is mainly located in not least taxes are a critical factor for the financial northern Sweden, while nuclear power, which aspect. In general solar energy can be expected to in 2014 accounted for 40 percent of electricity be mainly installed locally in relatively small units. production, is located along the coast in lower Historically power has flowed from a limited central Sweden (IVA Sweden’s Future Electricity number of power generating plants through the Production, A project report, 2016). national grid and regional grids before finally In a future electricity system scenario with an reaching the consumers via local grids. This one- increased amount of wind power, solar energy way flow has determined the design of things like and bioenergy, production is expected to be more safety and troubleshooting strategies, facilitated dispersed than today and will require changes to by the fact that the source and destination of the the electrical grid. Parts of the existing grid will power in the system is known. With more dis- no longer be needed and other parts will need to persed and variable generation, it is no longer safe be expanded and reinforced. to assume that the power is flowing from high Another important factor is economies of scale voltage levels to lower voltage levels. Solar energy at the future production facilities. Wind power has generation will, as described above, probably in significant scale benefits in that large turbines and most cases be connected to a local grid, thereby wind parks generate electricity far less expensively increasing the need for supervision, protection than small ones. Therefore a trend towards a lot of and control of local grids.

Figure 5: Sweden’s electricity production (2014) by different types of electricity generation on the left (IVA, Sweden’s Future Electricity Production, A project report 2016) and a map of Sweden showing the geographical location of 80 percent of electricity generation.

Hydropower Hydropower 64 TWh (42 %)

Wind power 12 TWh (8 %)

Bioenergy 13 TWh (9 %) Nuclear power Solar energy 0.1 TWh (0 %) Nuclear power 62 TWh (41 %)

19 There are human safety aspects to consider as vecklingsplan 2016–2025, 2015). But due to the well. In the conventional electrical grid people can high costs, offshore wind power will mainly be rest assured that the part of the grid that is discon- built very close to the coast. Wind power parks nected from high voltage really is voltage-free, and further out to sea will need to be connected to the therefore safe when, for example, maintenance national grid with direct current (DC) connectors. work needs to be done. Having production units But these types of investments are not currently such as solar cells at the distribution level will re- profitable. And require a special subsidy for off- quire the development of safety routines. It should shore wind power (Svenska kraftnät, Nätutveck- be noted, however, that several countries, includ- lingsplan 2016–2025, 2015). “Given that there ing Germany and Italy, have considerable experi- are good wind locations close to the coast and ence of a massive expansion of dispersed produc- on land, it is highly questionable whether such a tion and Sweden will be able to learn from them. subsidy is socioeconomically justified.” (Svenska kraftnät, Nätutvecklingsplan 2016–2025, 2015).

CONNECTING NEW PRODUCTION TO THE ELECTRICAL GRID FUTURE ELECTRICITY PRODUCTION ALTERNATIVES AND THEIR EFFECT ON Which part of the grid new production is con- THE ELECTRICAL GRID nected to depends on the size of the production unit. In order for a unit to be able to be connect- Within the Electricity Crossroads project four ed directly to the national grid, feed-in capacity conceivable alternatives for future electricity of at least 100 MW is needed to connect to the production have been created. In the analysis 220 kV grid and feed-in capacity of at least 300 conducted for this report the Electricity Distribu- MW is needed to connect to a 400 kV grid. Nu- tion and Transmission work group have used the clear power plants and large hydropower plants Electricity Production work group’s “medium” are connected directly to the national grid. scenario, which involves electricity generation of Most individual wind power plants will be 160 TWh. The conceivable production alterna- connected to local grids. Wind power parks tives are listed below and described in detail in with a capacity of less than 15 MW are normally the report produced by the Electricity Production connected to the local grid and parks between work group IVA, Sweden’s Future Electricity Pro- 15 MW and 300 MW are normally connected duction, A project report, 2016). to the regional grid (Swedish Energy Agency, Elanslutning av vindkraft till lokal-, region-, • Production alternative 1 – More solar and wind, och stamnätet, 2007). Large wind parks with a hereafter “PA More solar and wind” capacity of around 300 MW and above normally • Production alternative 2 – More bioenergy, need to be connected to the national grid. hereafter “PA More bioenergy” Most solar cell units are expected to be placed • Production alternative 3 – New nuclear power, on the users’ roofs and will therefore be connect- hereafter “PA New nuclear power” ed to the local grid. Small hydropower power • Production alternative 4 – More hydropower, plants and bioenergy plants are mainly connected hereafter “PA More hydropower” to regional grids depending on their size. Very small plants may be connected to the local grid. The different production alternatives are a mix The types of plants/units being built or decom- of electricity generation solutions at different missioned will, as described above, affect differ- levels. A general illustration of the production ent parts of the grid. The various production al- alternatives compared to today’s production ternatives’ combined effect on the different parts mix is presented in Figure 6. of the electrical grid is described on pages 22–29. Alternative 1 and 2 in particular will involve The greatest potential for offshore wind power production at new geographical locations with is in southern Sweden (Svenska kraftnät, Nätut- more dispersed small-scale electricity genera-

20 tion than today, combined with large-scale wind greatly determine their ability to be competitive. parks, and will require altering the electrical grid This is particularly important in the choices by, for example, building new power lines or re- that are made regarding large infrastructure in- inforcing existing ones. vestments. One illustration of this is in the grid In general there is good potential in Sweden development plan for 2016–2025 presented by to include variable energy production in the sys- Svenska kraftnät. Investments in the Swedish tem, because there is a supply of hydropower national grid are expected to be at historically and reservoirs to help even out variations over high levels for the foreseeable future. Existing most timeframes – from seconds and minutes up investment plans are expected to double the cost to months. Most of the plants that do this are of operation, administration and development. in northern Sweden. This, in combination with This in itself will have a significant impact on the fact that large wind farms will be built in the national grid charge that grid customers have northern Sweden due to good land availability to pay. About one third of these costs will go to and favourable wind conditions, will increase reinvestment in the existing grid. the need for transmission capacity from north- This chapter contains additional analysis of ern to central Sweden, so-called electricity areas the production alternatives’ effect on different (elområden) 1 and 1 or SE1 and SE2. electricity areas. Since 2011 Sweden has been di- When considering the different alternatives vided into four electricity areas as illustrated in for the future electricity system it is very impor- the table below. An assessment of where future tant to look at how grid operation is regulated. production in the different production alterna- For electricity intensive companies competing in tives could potentially be located is based on the the global arena, system costs for electric energy following analysis.

Figure 6: Breakdown of different types of generation in each production alternative, compared to today’s production capacity.

Production capacity 2014 65 65 15 20 Hydropower PA more solar and wind 65 55 25 15 2030–2050 Nuclear power PA more bioenergy 65 40 50 5 2030–2050 Wind power

PA new nuclear power 65 50 20 20 5 Bioenergy 2030–2050

PA more hydropower Solar energy 85 35 35 5 2030–2050

0 20 40 60 80 100 120 140 160 180 TWh SE1 Hydropower Hydropower is expected to expand in accordance with Swedenergy’s assessment (Luleå) (Swedenergy, Potential att utveckla vattenkraften – från energi till energi och effekt, 2015). Nuclear power New nuclear power is expected to be built where today’s existing nuclear power SE2 plants are located (Sundsvall) Wind power Wind power is expected to increase proportionately in accordance with Svenska kraftnät’s grid development plan (Svenska kraftnät, Nätutvecklingsplan 2016–2025, 2015). SE3 Bioenergy New CHP is mainly expected to be built where existing CHP plants exist today (Stockholm) (IVA, Sweden’s Future Electricity Production, A project report 2016). Solar energy Solar energy is expected to increase in line with the geographical distribution of the popu SE4 lation (the Electricity Distribution and Transmission group within Electricity Crossroads, 2016). (Malmö)

21 PRODUCTION ALTERNATIVE “MORE SOLAR AND WIND”

“PA More solar and wind” involves installed capacity totalling 53 GW and producing 160 TWh of electricity annually. With this production alternative Sweden would not achieve self-sufficiency in Electricity use 2014 10 power without extra measures being implemented. Despite the fact that the total installed capacity is 53 GW, the available power is only 21 GW. Electricity production capacity 2014 23 Electricity production capacity 10 100 29 GW Installed capacity – SE1 TWh Electricity production capacity – SE1 2030–2050 8 2014 80 2014

6 2030–2050 60 2030–2050

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

ElectricityElanvändning use 2014 1017

10 GW Installed capacity – SE2 100 TWh Electricity production capacity – SE2 ElectricityElproduktionskapacitet production capacity 2014 23 39 8 2014 80 2014 ElectricityElproduktionskapacitet production capacity 29 59 2030–2050 6 2030–2050 60 2030–2050

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

10 GW Installed capacity – SE3 100 TWh Electricity production capacity – SE3

8 2014 80 2014

6 2030–2050 60 2030–2050

4 40 ElectricityElanvändning use 2014 10 85 2 20 ElectricityElproduktionskapacitet production capacity 2014 23 93 0 0 ElectricityElproduktionskapacitet production capacity Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar 29 49 power power power energy energy power power power energy energy 2030–2050

10 GW Installed capacity – SE4 100 TWh Electricity production capacity – SE4

8 2014 80 2014

6 2030–2050 60 2030–2050

4 40 ElectricityElanvändning use 2014 10 24 2 20 ElectricityElproduktionskapacitet production capacity 2014 1023 0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar ElectricityElproduktionskapacitet production capacity power power power energy energy power power power energy energy 2329 2030–2050

22 The effect on the electrical grid in electricity areas 40 TWh. The transmission requirement from SE2 (SE) 1 and 2 would mainly consist of additional large- and through international connections will increase scale wind power (around 8 GW), which would pri- significantly. There would probably be a power defi- marily be connected to the national grid and regional cit in this area because the added installed capacity grids. Grid investments would be needed to connect would have a much lower capacity value than the the new wind power farms and investment would existing capacity. This could also add to the need for also be needed to reinforce the existing national and increased capacity in the north to south part of the regional grids. The regional grids today are in great national grid. need of capacity reinforcement to connect the wind power projects that are in the pipeline. The capac- The effect on area SE4 would mainly consist of the ity reinforcement requirements would thus be in- connection of new, small-scale production in the creased significantly in areas SE1 and SE2. form of wind and solar (around 3 GW wind and 4 GW solar). The means the effect would be the same The impact on SE3 consists of the disappearance of as for area SE3 above, but on a smaller scale. large-scale production (nuclear power) –just over 9 GW of installed capacity and 65 TWh of energy. The two charts below show how this alternative Production will be added mainly through medium changes the installed capacity and electricity genera- and small-scale wind power in local grids and through tion in each area. solar close to customers in local grids. Wind power will probably mainly be built in sparsely populated “PA More solar and wind” would increase the in- areas that have favourable wind conditions and will stalled capacity in all of the four electricity areas in be connected to local grids (around 4 GW). The Sweden, which could present a serious challenge for electrical grid in these areas will therefore need to the entire system as the available power in certain be reinforced and expanded to handle the additional cases could be five times greater than the demand. capacity connected. Solar power is connected close This would require expansion of the electrical grid to the customers in local grids, which may require because it is the capacity that determines the dimen- significant upgrading of certain low voltage grids to sions of the grid. The maximum amount of power handle the new capacity being fed in (9 GW). Up- drawn from the grid will increasingly be determined grades will in general be needed to maintain the right by variable energy production rather than by the voltage level in local grids. The amount of upgrading maximum power demand from users. This produc- needed depends on the concentration of solar en- tion alternative would also mean that electricity gen- ergy in each low-voltage grid and how far-reaching eration would increase in areas SE1, SE2 and SE4, and appropriately dimensioned the existing grid is. and be reduced in SE3. The way the grid is developed would be impacted by the construction of new In terms of energy, there will be a deficit in SE3, with production and of existing production plants being a decrease in the net balance for the area of around decommissioned.

60 Change in electricity production capacity 25 GW Installed capacity and capacity value compared with today

40 20 SE2 20 SE4 Installed capacity 2014 SE1 15 Installed capacity 0

TWh 10 2030–2050 -20 Capacity value 2014 5 -40 Capacity value SE3 -60 0 2030–2050 SE1 SE2 SE3 SE4

23 PRODUCTION ALTERNATIVE “MORE BIOENERGY”

”PA More bioenergy” involves a total installed capacity of 46 GW and total annual electricity generation of 160 TWh. The graphs below show how the different electricity areas in Sweden are ElectricityElanvändning use 2014 10 affected by “PA more bioenergy.” ElectricityElproduktionskapacitet production capacity 2014 23

ElectricityElproduktionskapacitet production capacity 10 GW Installed capacity – SE1 100 TWh Electricity production capacity – SE1 2930 2030–2050 8 2014 80 2014

6 2030–2050 60 2030–2050

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

ElectricityElanvändning use 2014 1017

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

10 GW Installed capacity – SE3 100 TWh Electricity production capacity – SE3

8 2014 80 2014

6 2030–2050 60 2030–2050

4 40 ElectricityElanvändning use 2014 10 85

2 20 ElectricityElproduktionskapacitet production capacity 2014 23 93 0 0 ElectricityElproduktionskapacitet production capacity Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar 29 57 power power power energy energy power power power energy energy 2030–2050

10 GW Installed capacity – SE4 100 TWh Electricity production capacity – SE4

8 2014 80 2014

6 2030–2050 60 2030–2050

24 This production alternative has the highest pro- connected, around 5 GW. There will be a need to portion of bioenergy of the four alternatives. The upgrade the regional grids in and around popula- assumption is that the new bioenergy plants will tion centres. With this alternative there will be an mainly be located where CHP plants exist today, or increase in wind and solar energy is in areas SE3, in heat systems located in population centres (IVA around 1 GW wind and 3 GW solar. This will also Sweden’s Future Electricity Production, A project drive upgrading costs, mainly in local grids to connect report, 2016). solar power, in the same way as described above for production alternative 1. The additional new pro- “PA More bioenergy” involves relatively small chang- duction, bioenergy, wind power and solar energy, es in area SE1 compared to today’s production situa- will not compensate for the reduction in the energy tion. A small increase (around 1 GW) in wind power supply from nuclear power. The energy balance in is expected in this area with this alternative. “PA the area will go down by around 40 TWh, which will more bioenergy” would have a limited impact on increase the need for transmission from area SE2 the grid in the area, but expansion would be needed and from other countries. where wind power is connected. In area SE4 the increase in new wind power, bioen- Wind power is expected to increase by around 3 ergy and solar energy are expected to be relatively GW of installed capacity and CHP (bioenergy) by evenly distributed (around 1 GW, 2 GW and 1 GW around 1 GW in area SE2. Expansion and upgrading respectively). There will therefore be a need for re- of the regional grid will be required in order to con- inforcement of the regional and local grids. nect the new wind power. Bioenergy is expected to be connected closer to population centres and often The two charts below show how “PA More bioen- in connection with an existing CHP plant. Upgrading ergy” changes the installed capacity and electricity of the regional grid will be needed to handle the ad- generation in each area. ditional installed capacity. “PA More bioenergy” will require an increase in in- Existing nuclear power plants located in area SE3 stalled capacity in three of the four areas in Sweden. are expected to be closed down in the “PA More The installed capacity and capacity value in area SE3 bioenergy” alternative, whereby around 9 GW of will, however, be significantly lower. This production installed capacity and 65 GWh of energy would dis- alternative would also mean that electricity produc- appear from the area. This is the area where the tion would increase in areas SE1, SE2 and SE4, and largest proportion of bioenergy is expected to be be reduced in SE3.

60 Change in electricity production capacity 2525 GWGW InstalledInstalled capacitycapacity andand capacitycapacity valuevalue compared with today

40 2020 SE2 20 SE4 InstalledInstallerat capacity effekt 2014 2014 SE1 1515 Installed capacity 0 Installerad effekt

TWh 1010 2030–2050 -20 CapacityEffektvärde value 2014 2014 55 -40 SE3 CapacityEffektvärde value -60 00 2030–2050 SE1SE1 SE2SE2 SE3 SE4

25 PRODUCTION ALTERNATIVE “NEW NUCLEAR POWER”

”PA New nuclear power” has a total installed capacity of 39 GW and total annual electricity generation of 160 TWh. The graphs below show how the different electricity areas ElectricityElanvändning use 2014 10 in Sweden are affected by “PA New nuclear power.” ElectricityElproduktionskapacitet production capacity 2014 23

ElectricityElproduktionskapacitet production capacity 10 GW Installed capacity – SE1 100 TWh Electricity production capacity – SE1 2329 2030–2050 8 2014 80 2014

6 2030–2050 60 2030–2050

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

ElectricityElanvändning use 2014 1017

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

10 GW Installed capacity – SE3 100 TWh Electricity production capacity – SE3

8 2014 80 2014

6 2030–2050 60 2030–2050

4 40 ElectricityElanvändning use 2014 10 85 2 20 ElectricityElproduktionskapacitet production capacity 2014 23 93

0 0 ElectricityElproduktionskapacitet production capacity Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar 29 82 power power power energy energy power power power energy energy 2030–2050

10 GW Installed capacity – SE4 100 TWh Electricity production capacity – SE4

8 2014 80 2014

6 2030–2050 60 2030–2050

4 40 ElectricityElanvändning use 20142014 10 24 2 20 ElectricityElproduktionskapacitet production capacity 20142014 1023 0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar ElectricityElproduktionskapacitet production capacity power power power energy energy power power power energy energy 13 29 2030–20502030–2050

26 “PA New nuclear power” is the only one of the four pected to be at the lower voltage levels. In terms alternatives presented that includes nuclear power of energy, however, solar will not replace nuclear in the production mix. A future scenario for new power in the area and the net reduction is expected nuclear power will require only minor changes to to be around 10 TWh. To handle the energy balance the electrical grid because the current grid is built in the area, transmission will need to be increased for a production mix including nuclear power. It will, from area SE2, but above all via connections from however, require the new reactors to be built in the Norway and Finland. Area SE4 will essentially be the same location as the old ones. same as today.

The impact on the grid in areas SE1 and SE2 is very The two charts below show how this alternative similar to today’s situation and is not expected to re- changes the installed capacity and electricity genera- quire any large investments in either of these areas. tion in each area. A small amount of wind power is expected to be added in area SE2, which will require some upgrades “PA New nuclear power” affects the electrical grid and connection improvements. the least because the grid today is constructed for nuclear power in area SE3. Part of today’s nuclear New nuclear power is expected to be based on ex- power is expected to be replaced by bioenergy, so- isting structures in area SE3. New installed solar en- lar energy and wind power, which will result in a ergy is also expected to be added in the area. More decrease of electricity generation in area SE3 and an of the power being fed into the grid is therefore ex- increase in the other areas.

60 Change in electricity production capacity 2525 GWGW InstalledInstalled capacitycapacity andand capacitycapacity valuevalue compared with today

40 2020 20 InstalledInstallerat capacity effekt 2014 2014 SE2 SE4 1515 SE1 InstalledInstallerad capacity effekt 0

TWh 1010 2030–2050 -20 SE3 CapacityEffektvärde value 2014 2014 55 -40 CapacityEffektvärde value -60 00 2030–2050 SE1SE1 SE2SE2 SE3 SE4

27 PRODUCTION ALTERNATIVE “MORE HYDROPOWER”

“PA More hydropower” involves installed capacity of 45 GW and total annual electricity generation of 160 TWh. The graphs below show how the different electricity areas in ElectricityElanvändning use 2014 10 Sweden are affected by “PA More hydropower.” ElectricityElproduktionskapacitet production capacity 2014 23

ElectricityElproduktionskapacitet production capacity 10 GW Installed capacity – SE1 100 TWh Electricity production capacity – SE1 2939 2030–2050 8 2014 80 2014

6 2030–2050 60 2030–2050

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

ElectricityElanvändning use 2014 1017 10 GW Installed capacity – SE2 100 TWh Electricity production capacity – SE2 ElectricityElproduktionskapacitet production capacity 2014 23 39

8 2014 80 2014 ElectricityElproduktionskapacitet production capacity 29 58 2030–2050 6 2030–2050 60 2030–2050

4 40

2 20

0 0 Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar power power power energy energy power power power energy energy

10 GW Installed capacity – SE3 100 TWh Electricity production capacity – SE3

8 2014 80 2014

6 2030–2050 60 2030–2050

4 40 ElectricityElanvändning use 2014 10 85

2 20 ElectricityElproduktionskapacitet production capacity 2014 23 93

0 0 ElectricityElproduktionskapacitet production capacity Hydro- Nuclear Wind Bio- Solar Hydro- Nuclear Wind Bio- Solar 2945 power power power energy energy power power power energy energy 2030–2050

10 GW Installed capacity – SE4 100 TWh Electricity production capacity – SE4

8 2014 80 2014

6 2030–2050 60 2030–2050

28 “PA More hydropower” is the only alternative of the Just as with “PA Solar and wind” and “PA More four presented that involves an increase in electric- bioenergy,” existing nuclear power will disappear in ity generation from hydropower. A scenario in which area SE3 for “PA More hydropower.” With this al- hydropower is expanded will probably require both ternative, additional new generation in the area will efficiency improvement at existing power plants and mainly consist of solar energy, 3 GW, and bioenergy, expansion in rivers that are already being used, but around 3 GW. A smaller volume of wind power will also expansion in so far untouched rivers and other also be added. Reinforcements will be needed in the protected rivers. relevant regional and local grids in order to handle the additional electricity generated. The net balance “PA More hydropower” will involve an increase in for generated electricity in the area is expected to installed capacity in area SE1 of around 3 GW, mainly fall by around 50 TWh, which will be compensated through upgrading of existing hydropower in the area for mainly by an increase in transmission from area and new hydropower. A smaller portion of the in- SE2. This will also require reinforcement of the na- crease will come from wind power, of around 0.5–1 tional grid. GW. The increased production of electricity is expected to be around 15 TWh and this will need to A certain increase in new wind power, CHP and be sent south. It will be necessary to reinforce and solar energy, totalling around 2–3 GW, is expected upgrade the national grid to handle the increased vol- in area SE4. This means that reinforcement will be umes and the increased power entering the system. needed in the relevant regional grids, mainly for connecting wind power and CHP. The local grids will be The amount of hydropower will also increase in area affected as described above in the other produc- SE2, by 1.5–2 GW of installed capacity. But large- tion alternatives as a result of increased installation scale wind power will also be increased, around 2.5 of solar energy. GW of installed capacity. An expansion, mainly of the regional grids in the area, will be necessary in order The two charts below show how this alternative to connect the new wind power, and reinforcement changes the installed capacity and electricity genera- of the regional grids and the national grid in order to tion in each area. receive electricity from the upgraded hydropower. The amount of electricity generated is expected to “PA More hydropower” is characterised by an ex- increase by 15 TWh, which is mainly expected to pansion of hydropower, mainly in area SE1 and SE2, be transferred southwards. If the increased volume and a reduction of nuclear power in SE3. The differ- of electricity that will be fed in from area SE1 is also ent production alternatives impact different parts of taken into account, an upgrade of the national grid the electrical grid. will be necessary in the area.

60 Change in electricity production capacity 2525 GWGW InstalledInstalled capacitycapacity andand capacitycapacity valuevalue compared with today

40 2020 SE2 20 SE1 InstalledInstallerat capacity effekt 2014 2014 SE4 1515 Installed capacity 0 Installerad effekt

TWh 1010 2030–2050 -20 CapacityEffektvärde value 2014 2014 55 -40 CapacityEffektvärde value -60 SE3 00 2030–2050 SE1SE1 SE2SE2 SE3 SE4

29 Local grids Regional grids National grid A large amount or new solar energy (total of A large amount of new wind power (total of around 10 GW), The national grid will need to be reinforced around 15 GW), affecting the local grid, mainly in part of which is connected to the regional grid depending on due to the considerable expansion of wind area SE3. Solar energy is connected close to the size, will require a significant expansion of the regional grid. New power in area SE2, but also due to the loss of customers in local grids, and significant upgrad- wind power production is expected to be located in all four nuclear power in area SE3. Both the addition ing of some low voltage grids may therefore be areas with the biggest increase in area SE2. Expansion and up- of new wind power in the north and the loss required. Upgrades will frequently be needed to grading of the regional grid will be required in order to connect of nuclear power will increase the need to maintain the right voltage level in local grids. the new wind power. transfer energy from northern Sweden to the southern parts. This will require expansion and A large amount of new wind power (total of reinforcement of the national grid. around 10 GW), part of which is connected to the local grid depending on size, will require a

“PA More solar and wind” significant expansion of the local grid. New wind power production is expected to be located in all four areas, with the biggest increase in area SE2. Some new solar energy which will the local grid Some new wind power (total of around 6 GW), part of which The national grid will need to be reinforced and will therefore require expansion of the local will be connected to the regional grid depending on size and due to the considerable expansion of wind grid (total of around 5 GW). therefore will require a significant expansion of the regional grid. power in area SE2, but also due to the loss of New wind power production is expected to be located in all nuclear power in area SE3. Both the addition Some new wind power (total of around 6 GW), four areas, with the biggest increase in area SE2. of new wind power in the north and the loss part of which is connected to the local grid of nuclear power will increase the need to depending on size. New wind power production New bioenergy (total of around 7 GW) will mainly affect the transfer energy from northern Sweden to the is expected to be located in all four areas with the regional grid in area SE3, where much of the bioenergy capacity southern parts. This will require expansion and “PA More bioenergy”“PA biggest increase in area SE2. is expected to be located. reinforcement of the national grid.

Some new solar energy, which will affect the local Very little impact on regional grids. Very little impact on the national grid. grids, requiring expansion and reinforcement (total of around 5 GW). “PA New nuclear power”

Some new solar energy, which will affect the Some new wind power (total of around 5 GW), part of which The national grid will need to be reinforced local grids and therefore requires expansion and is connected to the regional grids depending on size and would due to the considerable expansion of hydro- reinforcement (total of around 5 GW). therefore require expansion and reinforcement of the regional power in areas SE1 and SE2, but also due to grids. New wind power production is expected to be located in the loss of nuclear power in area SE3. The Some new wind power (total of around 5 GW), all four areas with the biggest increase in area SE2. addition of new hydropower (total of around part of which will be connected to the local 5 GW) and wind power mainly in area SE2, as grids depending on size, will therefore require an New bioenergy (total of around 4 GW) will mainly affect the well as the loss of nuclear power in area SE3, expansion of the local grids. New wind power regional grid in area SE3, where much of the bioenergy capacity will increase the need to transfer energy from production is expected to be located in all four is expected to be located.* Expansion of hydropower (total of northern Sweden to the southern parts. This

“PA More hydropower” areas with the biggest increase in area SE2. around 5 GW) in area SE1 and SE2 will also to some extent will require expansion and reinforcement of affect the regional grids, requiring reinforcement and expansion. the national grid.

* If population centres with existing CHP plants with increased capacity are to increase their production for the population centre, the current regional grid capacity will probably be sufficient. If, on the other hand, the increased production is transferred to overlying grids, the regional grids will need to be reinforced.

Table 3: Added electricity generation in SUMMARY the different production alternatives (IVA, Sweden’s Future Electricity Production, The different production alternatives require different amounts of new pro- A project report 2016). duction capacity to be connected to the electrical grid. Table 3 shows how much new production capacity needs to be connected for each alternative. The electrical As mentioned before, different production sources are connected at dif- grid (GW) ferent voltage levels and therefore affect different parts of the electrical grid. “PA More solar and wind” 26 Small-scale generation is, for example, connected to the local grid, while “PA More bioenergy” 18 large-scale electricity production is connected to the national grid. Produc- “PA New nuclear power” 5 tion that is medium in size is connected to the regional grid. Above is a summary of how the different production alternatives impact different parts of “PA More hydropower” 18 the electrical grid.

30 5. Sweden’s level of self-sufficiency

Self-sufficiency in electricity can mean energy 874 MW from production and 626 MW in con- self-sufficiency or power self-sufficiency. Self- sumption reductions (Svenska kraftnät, Kraft- sufficiency in energy is where Sweden would pro- balansen på den svenska elmarknaden, 2015). duce at least as much electricity as the country uses during a year. Self-sufficiency in power is where Sweden is able to deliver the electricity the OTHER COUNTRIES country needs at any given moment. This means sometimes having a large amount of installed Sweden today has direct current (DC) connections overcapacity, which would either be wasted or with Germany, Denmark, Poland, Lithuania and exported to other countries. Exporting to other Finland. And also alternating current (AC) connec- countries also requires the recipient country to tions with Norway, Finland and Denmark. The have adequate electricity infrastructure so that connection built most recently, NordBalt, runs be- these countries can receive the electricity being tween Sweden and Lithuania. It was put into com- exported. mission in the first quarter of 2016. Sweden’s in- Regardless of the type of self-sufficiency, ex- ternational connections are illustrated in Figure 7. porting relies on having sufficient transmission One important consideration is the electric- capacity between Sweden and other countries. If ity generation situation in the regions to which Sweden wants to be able to export or import more an expansion of the grid infrastructure is being Figure 7: Sweden’s electricity, more transmission capacity is needed. built. Connecting the grid to a deficit area will international connections, blue result in increased prices in Sweden. There is also lines indicate AC uncertainty about to what extent there is energy links and red lines SWEDEN’S POWER RESERVE available to flow back to Sweden when it is need- indicated DC links ed here. This is an important factor for Sweden’s (Svenska kraftnät, Svenska kraftnät is responsible for guaranteeing energy-intensive processing industries that are 2016). the country’s short-term power balance, i.e. the competing in the global arena. balance between supply (production and imports) Energy storage, which is described later on and demand (electricity consumption). To main- in this report, may help to increase Sweden’s tain a power balance during the coldest part of level of self-sufficiency and reduce the winter Svenska kraftnät has been tasked with need for exports and imports between securing a special power reserve not exceeding Sweden and other countries. 2 GW in the period 16 November to 15 March. The consequences of Sweden’s self- The power reserve is either secured through in- sufficiency level – whether power creased production or a reduction in electricity or energy – will vary, with self- consumption by large users. The current law will sufficiency in power having a stay in effect until 16 March 2020. The Govern- greater impact on the electri- ment is preparing a proposal to extend the power cal grid. Both high and low reserve law until 2025 (IVA, Sweden’s Future Elec- levels of self-sufficiency tricity Production, A project report 2016). will require more transmis- Before the winter of 2014/2015 a power re- sion capacity between Swe- serve of 1,500 MW was purchased, consisting of den and other countries.

31 Source: Svenska kraftnät, 2015

32 6. Future delivery reliability requirements

High delivery reliability and secure access means employees or contractors. There is also an excep- that the electrical grid delivers electricity when tion if the outage is due to obstacles outside the it is supposed to and with few outages. Today’s grid company’s control, faults in the national society is dependent on electricity at workplaces grid, neglect on the part of electricity users or if and homes. Even the shortest interruption in the the power was cut for electricity safety reasons. electricity supply creates immediate problems. The quality incentive in the revenue rule is at pre- Electricity as a service is therefore expected to sent relatively weak as a control mechanism. offer a very high level of accessibility. Investments made by Swedish grid companies Table 4 shows the accessibility of electricity de- to raise delivery reliability have been considerable livery expressed as a percentage of the year in a over the past 10 to 15 years. Looking at Sweden number of European countries in 2010. as a whole, however, it is difficult to see any clear Accessibility in all countries presented in the trends or improvements with respect to the av- table except Romania is more than 99.9 percent. erage number of outages. The statistics instead Availability above 99.9 percent may seem high, show that the number of outages is relatively but it is important to know what this means in stable over time, except for the years when there terms of the length of a power cut for an electric- have been serious storms (2005, 2007 and 2011), ity customer. For example, a drop in accessibil- when there were a few more outages than in other ity from 99.99 percent to 99.98 percent means years. But there are clear improvements on the that the average duration of an interruption in a local level in the areas where the grid companies customer’s electricity supply is doubled – from 53 have invested to improve delivery quality. minutes to 1 h 45 mins (Swedish Energy Markets Altogether the conclusion can be drawn that Inspectorate, Leveranssäkerhet i elnäten 2012, delivery reliability in the Swedish local grids is 2014). still heavily dependent on weather conditions. According to the Electricity Act (Ellagen) Delivery reliability requirements may increase Electricity transmission must be of good qual- in the future, for all types of grids. Today’s high- ity. The Swedish Energy Markets Inspectorate’s tech society is already entirely dependent on elec- regulations, EIFS 2013:01, describe the criteria tricity in order to function, and this dependence for transmission to be considered of good quality. will continue to increase in a society where auto- One important and governing criteria addresses mation and digitisation are important develop- functionality and stipulates that an electricity ment and growth areas. outage may not last longer than 24 hours. There Even very short outages and poor electricity are also requirements regarding the number of quality may result in large costs for the produc- unannounced outages, tree safety for overhead ing companies due to production losses during lines and voltage quality. standstills, waste and restarting. The question Users are entitled to outage compensation if an of how often instances of poor electricity qual- outage lasts for 12 hours or more. Grid compa- ity lead to production stoppages is an important nies have the possibility of getting an adjustment one. A stoppage that occurs every tenth year is an if the compensation is unduly burdensome for the entirely different thing than one that arises every company or if their ability to fix the problem is year or every other year. Technology in the future delayed due to risks posed to the grid company’s will probably make these processes more sensi-

33 tive and expectations for delivery reliability will second could lead to production stoppages that therefore increase further. Nor can society in a have significantly negative effects for companies. future with more electrification of the transport The length of an outage is less of a concern than sector accept people not being able to get to work the frequency of outages. or goods not being delivered due to a power out- Increased delivery reliability requirements may, age preventing vehicles from being charged. for example, mean that outages need to be fixed Table 5 presents the average length of an out- faster, that the electrical grid must be further age and estimated outage costs in 2012 for a weather-proofed and that a grid company’s costs number of different customer groups. There are, and compensation obligation to its customers will however, large variations in each customer group increase in the event of an outage. Delivery reliabil- where electricity-intensive industries have sig- ity could, however, be improved through local so- nificantly higher outage costs than the average lutions, such as energy storage. The consequences industry customer. The cost for energy-intensive of an outage for energy-intensive processing indus- companies of a single outage could be up to SEK tries with continuous production can be extremely 100 million. The data in the table cannot there- sensitive. Outages for a split second may be suf- fore be regarded as representative for all compa- ficient for major damage to be done to production nies in the category. Outages that last for a split processes.

Table 4: Availability of electricity delivery as a percentage of the year in a number of European countries in 2010. (Swedish Energy Markets Inspectorate, Leveranssäkerhet i elnäten 2012, 2014).

Country Availability [percent] Finland 99.99 Germany 99.99 Norway 99.99 Sweden 99.98 France 99.98 Italy 99.98 United Kingdom 99.98 Lithuania 99.95 Portugal 99.95 Romania 99.87

Table 5: The average duration of an outage and estimated outage costs in 2012 for different customer categories (Swedish Energy Markets Inspectorate, Leveranssäkerhet i elnäten 2012, 2014).

Average duration Outage cost Customer category of outage [min] [SEK million] Agriculture 165 23 Industry 81 200 Products and services 64 610 Public sector 80 76 Households 91 66

34 7. Storage

Electricity storage can help the electricity sys- regions Sweden is connected to supports this at tem in numerous ways. One way is by improving the particular times when more energy is needed electricity quality; another is taking advantage in the Swedish system. of electricity being generated when it cannot be Due to the geographical location of Sweden used right away. and Norway, the development of offshore ca- With growth in the volume of weather-de- bles is the most important consideration in this pendent energy in the system, the need for level- context. By converting existing overhead lines to ling out the available power using energy stor- direct current Sweden can increase the capacity age solutions increases. For many years energy in power line corridors and the ability to control has been stored in the power system in the form the grid. of fuel or in reservoirs at hydropower plants. Countries with the right conditions have also Seasonal storage stored energy in the form of so-called pumped Based on good access to the large reservoirs at storage plants, where water can be pumped up hydropower plants, the Swedish system is excep- to a higher dam for subsequent electricity gen- tionally well-suited to handle the power varia- eration. tions in solar and wind. Due to their large res- Grid investments could be avoided through ervoirs these power plants can balance out both more decentralised electricity production and short-term and seasonal production variations more widespread use of increasingly inexpensive without the need to build special energy storage, batteries. Batteries could also be combined with such as pumped storage plants. The energy con- the use of electronics to improve stability and tent in, for example, the Suorva dam, Sweden’s electricity quality in the distribution grid. largest hydropower reservoir, is equivalent to 6 TWh or around one tenth of the total hydropow- Hydropower as a power reserve er generated annually in Sweden. In relative terms, the Nordic electricity system has plenty of storage capacity for daily, weekly Short-term storage or annual storage in the form of hydropower Right now the price of, above all, lithium ion plants with reservoirs. This is a very important batteries for the automotive industry are falling resource to use to, for example, balance out fast. Predictions indicate that this trend will im- weather-dependent generation from solar and pact electrical grids as well. Battery technology wind. Swedish and Norwegian hydropower for the grid could benefit the system in various could also be used as a power reserve in a wider ways. No single system benefit today provides a area beyond the Nordic region. sufficient reason to invest. Apart from the obvi- Increasing transmission capacity within Swe- ous possibility of trading on the energy market den and to neighbouring countries will give on a “daily basis,” battery storage could, for ex- Swedish hydropower plants more opportunities ample, be used to even out local power peaks. It to serve as power reserves. This provides a mu- would also be possible to defer grid investments tual benefit in that Sweden can also import pow- when there is an overload risk when, for exam- er reserves through the transmission links as an ple, there is an increased concentration of homes alternative to paying to have power stations on in an area or a sharp local increase in electric standby, provided that the energy balance in the vehicles that need to be charged. Battery storage

35 Figure 8: Examples of system benefits from storage

Manage Power outages weather- Grid Grid Electricity quality dependent limitations tariffs Losses production

Power outages Production Grid Electricity quality planning tariffs Losses

could also help with frequency regulation and that seasonal storage of both heat and cold is benefit the grid in other ways. possible in Sweden. Seasonal storage can fill an Lithium-ion technology seems to be the most important function in the Swedish grid in the competitive technology for energy storage of up future, particularly in production alternatives 1 to a few (2–4) hours in grids with an increasing and 2 described above. proportion of wind and solar, although more re- search is needed here to study specific conditions Power-to-gas in Sweden. Development of this type of energy Power-to-gas is chemical storage of electricity storage will also be strongly linked to the way in in the form of gas. Power-to-gas enables weekly which the regulations, laws and markets develop storage, which is the main type needed when as these do not fully address the issue of energy there is a large proportion of wind power in the storage today. system. The gas can either be used in vehicles or industrial applications, or to generate electricity System benefits at thermal plants. Stored energy may benefit the system by, for example, relieving the pressure on local grids, Storage regulation optimising production of all types of electric- Today the rules stipulate that distribution system ity, improving electricity quality etc. No value operators (DSOs) and transmission system opera- has yet been assigned to these benefits. Figure 8 tors (TSOs), i.e. Svenska kraftnät, are not permit- shows where energy storage is principally locat- ted to own stored energy so as not to be able to ed. There are different owners, legal structures, “influence the market price.” The law today – the market models, value-generating applications Electricity Act chapter 3 Section 16 – allows grid and technical solutions for each one. companies to own energy storage, but the area Energy storage also takes significantly less of application is strictly limited to covering grid time to build than today’s cable (and probably losses or temporarily replacing a loss of electric- also new hydropower) permit processes allow. ity in the event of an outage.

Thermal energy storage Thermal storage is also an option for Sweden to consider. Several sources have now reported

36 8. EU influence

Energy infrastructure has been at the top of European Council with the objective of arriving the European energy agenda for a long time. at a 15% target by 2030.” According to the European Commission, in- Comprehensive legislative work is continuing terlinked European energy grids are crucial to at the EU level to turn the European Council’s de- secure Europe’s energy supply, to increase com- cisions into EU law. petition in the internal market and to achieve In general there is a trend of greater and faster the climate policy goals. variations in the power flows in In October 2014 the European Council re- Europe. This is mainly the result of an in- quested “speedy implementation of all the creased proportion of wind and solar power. measures to meet the target of achieving inter- The need for load-balancing power is therefore connection of at least 10 % of their installed growing considerably. International connections electricity production capacity for all Member in the system enable exports to the Continent States.” when prices are high and imports when prices Within the framework of the decision on form- are lower. The socioeconomic consequences of ing an energy union with a forward-looking cli- importing when electricity prices are high on the mate policy, the European Council also approved continent due to international connections and the Commission’s proposal for a 10 percent in- the uncertainty about available power when defi- terconnection target by 2010. The target will be cits arise in the Swedish electricity market must achieved through the implementation of Projects be carefully analysed. of Common Interest (PCIs). The Union’s first list of PCIs was adopted in 2013 and contains 248 projects. GRID CODES AND COMMISSION Sweden is strong in terms of its interconnec- GUIDELINES tions with neighbouring countries. With Nor- dBalt added into the equation, Sweden’s inter- The third internal market package for electric- national connections amount to a capacity of ity was adopted in 2009. Its implementation re- 11,300 MW. Sweden’s electricity generation plants sulted in a series of new legal requirements and have 39,500 MW of installed capacity, which mechanisms to increase competitiveness in the could mean a theoretical interconnection level of wholesale markets and in cross-border trading. 28.6 percent. With this theoretical installed ca- It also guaranteed effective load-balancing and pacity of 39,500 MW the normal available capac- created the right climate for investments that ity over time is around 28,000 MW. This means are expected to benefit customers. The package that Sweden essentially has an interconnection of laws also involved new binding legislation level (including NordBalt) with other countries through so-called grid codes and commission amounting to 40 percent. guidelines. The Commission is still working on initiatives The new regulations gave the Commission for greater regional cooperation. At the European extensive powers to drive development. The Council’s meeting in October 2014 the Commis- supervisory authorities – including the Swed- sion was mandated to report “regularly to the ish Energy Markets Inspectorate – were given

37 expanded national responsibility for overseeing to create a framework for cross-border trad- the competitive situation and the effectiveness of ing in electricity and gas, so-called framework the electricity market, and for certifying system guidelines. Based on these, ENTSO-E is working operators. The Agency for the Cooperation of on proposed grid codes, i.e. more specific rules Energy Regulators (ACER) was also created. based on the framework guidelines. Cooperation across regions was strengthened The network codes relate to most of the sys- based on a so-called “from below” principle tem operators’ activities – everything from terms where the system operators and the authori- and conditions when connecting power plants, ties within a region work together on network to management of transmission capacity in the planning, operations and marketing, and this is short and long term. The codes also address followed up at the national and European level. electricity exchanges and trading between mem- Through the third internal market package, ber nations. cooperation between the system operators has Stricter requirements and guidelines from the been formalised through the European Network EU are increasingly affecting how the Swedish of Transmission System Operators for Electric- electrical grid is being developed. ity (ENTSO-E). Through the new division of responsibilities, the Commission is giving a mandate to ACER

38 9. New investment in the electrical grid

The electrical grid is constantly being improved, after the storms Gudrun and Per and, to date, partly through replacement of ageing equip- more than 50,000 km of hanging overhead lines ment, but also by quality-enhancing measures, have been replaced by underground cables. Even new generation connections and other changes in though there are large investment programmes electricity use and electricity production. in place to weatherproof the electrical grid, the The investment needs are mainly driven by grid grid companies need to invest in replacing ageing age-related reinvestment and connection of new plants in order to ensure delivery reliability. production. Renewal of the electrical grid is also taking place to meet society’s delivery reliability demands. Since the beginning of the 2000s, grid INVESTMENTS IN LOCAL companies have had a voluntary agreement with AND REGIONAL GRIDS the Government to replace uninsulated overhead lines with underground cables to reduce the grid’s The age structure of Sweden’s local and region- weather dependence. This became more urgent al grids is such that around 70 percent of the

Figure 9: Typical investment cycle in electrical grids in Europe (Nilsson, 2015).

SEK billions 50,000

40,000

30,000

20,000

10,000

1900 1906 1912 1918 1924 1930 1936 1942 1948 1954 1960 1966 1972 1978 1984 1990 1996 2002 2008 2014 2020 2026 2032 2038 2044 2050 2056

Current acquisition cost 2016 Distribution (SEK billion) in percent Local grid 310.6 79 % Regional grid 85.0 21 % Total 395.6 100 %

39 Figure 10: Industry investments RP2, SEK billion. Figure 11: Age structure of the national grid’s lines Based on company applications. (Svenska kraftnät, Perspektivplan 2025, 2013)

16 5,000 Regional grid (5 st) Local grid (153 st) 14 km 220 kV line 4,000 12 3.96 km 400 kV line 3.52 10 3.20 3,000 2.88 8

6 2,000 8.75 9.18 4 7.32 8.22 1,000 2

0 0 2016 2017 2018 2019

0–9 years >70 years 10–19 years20–29 years30–39 years40–49 years50–59 years60–69 years

Figure 12: Planned investments in the national grid (Svenska kraftnät, Nätutvecklingsplan 2016–2025, 2015)

SEK millions

8,000 Market integration

6,000 Reinvestment Connection of new electricity production 4,000

2,000

0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

grid components are more than 20 years old value annually to keep plants current (EI, An- and around 37 percent are more than 38 years sökningar om tillåten intäkt 2016–2019, 2015). old (Swedish Energy Market Inspectorate I, Electrical grid investments have a time per- Energy Commission seminar on transmission, spective of around 40 years or more and, in ad- 2015). dition to providing high delivery reliability now, The electrical grid structure has not been ex- must ensure that the grid being built today is in panded steadily year by year. It went through a line with the future electricity system, so that no significant expansion 40 to 50 years ago and is unnecessary lock-in effects occur. consequently now in dire need of an investment Over the next four years investment in the in- boost. dustry will increase significantly, and this is not The total current acquisition cost of Sweden’s expected to diminish during the next regulatory electrical grid is SEK 400 billion. The electrical periods, see Figure 10. grid companies must invest at least 1/40 of the Most of the future investments will be to re-

40 place old components that are at risk of break- between, for example, two electricity areas, it ing down or whose economic life has ended. is often necessary to include smaller supplemen- In addition to reinvestment, investments will be tary grid reinforcement to handle regional and driven by the way in which the electrical grid is local limitations arising in connection with an expanded. A strong urbanisation trend in Sweden, increase in average capacity. with a population influx into big cities and greater population density, will put more pressure on the grid to and within cities. New residential areas, FUTURE INVESTMENTS new infrastructure and new commercial buildings WITH NEW CONDITIONS are driving an expansion or reinforcement of existing grid infrastructure, while the opposite trend Age and delivery reliability will remain the main is evident in sparsely populated areas. drivers of investment in the future. In a scenario The regional grids account for around 21 per- with entirely different electricity generation so- cent or around SEK 85 billion of the total value of lutions and changed user behaviour, such as an the electrical grid. And have already reached ca- electrified transport sector, the variations in the pacity saturation in terms of connection of wind power being drawn from the grid by end con- power and are now in need of or are implement- sumers will increase substantially. The flow of ing capacity reinforcement to allow planned power may in certain cases also change, so that wind power projects to go forward. There are certain local grids or parts of local grids will also parallel reinvestments being made, driven become “net producers.” by ageing components. In a study by Elforsk on the future requirements of the electrical grid, two main phases were identified: a capacity phase and an expan- INVESTMENTS IN THE NATIONAL GRID sion phase. During the capacity phase the main focus is improving the use of the existing grid. The national grid also has ageing infrastructure. This will, among other things, require further Figure 11 shows the age of the national grid’s measurement and analysis of data and supervi- power lines. sion and control to drive the grid towards bet- Svenska kraftnät is working according to a ter and more efficient methods to maintain high comprehensive process to ensure that all rel- delivery reliability. Investments could therefore evant aspects are taken into account when be avoided or deferred. planning for the future capacity needs and grid An increased penetration of solar cells in lo- design. The energy system is complex and thor- cal grids and wind power in regional grids will ough analysis is required to determine which require capacity reinforcement, but these may be measures are the most suitable to maintain the implemented within the framework of existing right level of transmission capacity in the grid. renewal programmes, i.e. extensive premature The transmission capacity of the national grid replacements will not be required. The challenge is affected by many factors and an evaluation of is knowing where and when changes in the en- it must include market and system technology ergy system will happen in a so-called expansion phenomena. It may take up to a year to perform phase. the necessary analysis that a comprehensive grid Regardless of the changes in the energy sys- study requires. Svenska kraftnät’s planned in- tem, the big investment programmes will be vestments are shown in Figure 12. driven by renewal of the electrical grid with a The relationship between grid capacity and clear focus on the grids that are approaching the cost of investments in the national grid are the age of 50. Investments will be driven by a not linear but gradual. Nor is the extent of ca- combination of maintaining delivery reliability pacity increases always in proportion to the and increasing capacity in regions with strong investment costs. When large investment are population growth or the growth of new elec- made (e.g. in new cables) to increase capacity tricity generation.

41 Table 6: Two Svenska kraftnät projects in progress (Svenska kraftnät, Nätutvecklingsplan 2016–2025, 2015).

SydVästlänken NordBalt Investment SEK 7.3 billion * SEK 2.5 billion Geographical location Between Hallsberg in area SE3 and Between Nybro in Småland, Sweden Hörby in area SE4 (area SE4) and Klaipeda in Lithuania Technology Alternating current (400 kV) and direct Direct current, HVDC VSC current, HVDC VSC (2x600 MW) (700 MW) Length of power line AC cable 180 km, DC line 60 km, Length of offshore cable 400 km, length of DC cable 190 km underground cable 40 km on the Swedish side and 10 km on the Lithuanian side

* and previous investments of SEK 500 million

THE COST OF THE GRID IN RELATION estimated added cost would be at the lower end TO NEW PRODUCTION of the scale. If the reinvestments fail to contribute to the necessary capacity increase, additional The cost of adapting the electrical grid for the power lines would need to be built. One or two different production alternatives is small com- new power lines could be used, depending on pared to the costs of the different electricity how operational measures are combined with production facilities. This does not mean that grid investments. If the one power line option developing the grid is simple; it is important is chosen, it is estimated that the additional cost to plan ahead, and efficient planning and per- will be in the middle of the scale. The invest- mit processes are also essential. The value of a ment will be on the upper end if the two power well-developed electrical grid is great, however, line option is chosen. If modern direct current because it means that the cheapest production technology is used, the system would gain other options are available in northern Europe at any benefits as an extra bonus. given moment. Table 6 presents examples of the cost of on An investment in transmission to handle going Svenska kraftnät projects. 5,000 MW of wind power in northern Sweden would roughly be in the range of SEK 1,800– 10,400 million, which is 1/50–1/10 of the cost of the actual wind turbines. If the current standards for new power lines require that the capacity increase of an average of two power lines as motivated by wind power is reached in connection with a reinvestment in the power lines, the

42 10. Future price structures

The Swedish electricity market consists of a companies that distribute electricity to around number of actors who can be divided into three 5.2 million customers. Around 110 of the grid main groups: actors engaged in electricity trad- companies have 15,000 customers or fewer. This ing, actors who are responsible for infrastruc- creates a fragmented market of natural monopo- ture and actors who organise electricity trad- lies, which is different to the situation in several ing. This report focuses on the actors who are other European countries. The ownership struc- responsible for the electricity infrastructure, i.e. tures of the larger companies vary and with dif- the grid companies. ferent types of owners. The medium-sized and According to the Electricity Act, operating small companies are largely owned by a munici- a grid involves making electrical high-voltage pality or an economic association. See the cur- power lines available for the transmission of rent ownership structure for the Swedish grids electric energy. An electrical grid company owns in Figure 13. How the companies are governed the power lines that link an electricity produc- may differ depending on the owner and this also er’s plant to electricity users’ equipment. The determines how investments, pricing strategies grid owners are responsible for distribution of etc. are planned. electricity between the electricity producers and electricity users via national, regional and local grids. SWEDEN’S REGULATION MODEL The Electricity Act regulates the activities of the grid companies. The Act stipulates, for ex- Because there is no competition between grid ample, that grid companies are not permitted to companies, the Swedish Energy Markets Inspec- trade in electricity. torate oversees the situation to make sure grid Today there are around 170 electrical grid companies do not overcharge. The Inspectorate

Figure 13: Current ownership structure Figure 14: Grid company costs for the Swedish electrical grid

Venture capital (Falbygden) Quality incentives 3.2 % Listed companies 1 % Costs that can (E.ON, Vallentuna Elverk) be affected 22 % 20 % Municipal-owned economic association Capital costs 30.8 % 50 % State-owned (Vattenfall) Cost that cannot 22 % be affected Pension capital 30 % (Ellevio) 22 %

43 sets a ceiling for how much grid companies can market in the mid-1990s. Revenue regulation has charge all customers in their area over a four- been changed essentially every four years since year period – a so-called revenue framework. deregulation. This revenue rule establishes the total revenue, The basic principle for regulation is based on i.e. not how much individual customers are maintaining capacity in the grid, driven by cov- charged. That is determined by a tariff struc- ering the cost of operation/maintenance, and the ture. The revenue framework is set in advance cost of capital, which for the current period is for a four-year period and the current period is determined in advance according to the relevant 2016–2019. EU laws. If a company charges more than the permitted When the revenue model is developed, factors amount, the Swedish Energy Markets Inspector- such as delivery reliability, the investment cli- ate lowers its framework for the next period with mate, technology development and other coun- the corresponding amount. The company may tries must be taken into account. also be required to pay a penalty if the charges Figure 14 shows the grid companies’ costs. exceed the framework by more than 5 percent. The behaviour of grid companies is influenced The regulation model has been changed and by the types of incentives that exist in the regu- developed since deregulation of the electricity latory frameworks. Because the regulations are

Figure 15: Development of the Swedish regulation model

2003–07 2008–11 2012–15 2016–19

Grid benefit Interim Real annuity Real linear model regulation model model (ex-post) (ex-post) (ex-ante) (ex-ante)

Figure 16: Electrical grid tariff options ONE Sweden price

Electrical grid Facilitates joint tariff options accounting within each company

Individualised grid costs

44 changed every four years to include different where municipal companies or economic associ- incentives, it is hard to judge whether the grid ations operate are mainly in population centres. is developing in the right way. A clear, general In addition to what is stated above on meet- political vision for regulation is required if the ing the provisions in the Electricity Act with re- electrical grid is to be a facilitator and the grid gards to fair and non-discriminatory tariffs, the is to be developed in a way that represents the aim when setting prices should also be that the needs of the grid customers. This needs to be customers are able to accept and understand the done in a way that is socioeconomically effec- tariffs. It is therefore beneficial to keep general tive and allows the grid owners to attract capital tariff structures as clear and simple as possible to develop the grid. The work that the Swedish and with as few categories as possible. Energy Markets Inspectorate has started with respect to future grid regulations addresses both Power tariff short-term and long-term issues and is a valuable One possible development is tariffs that more initiative in this perspective. closely represent costs by moving towards power tariffs. Power tariffs would give the customers greater control over their own costs by changing TODAY’S GRID TARIFFS the time electricity is consumed, thereby even- ing out their peak loads. This could be good for The grid charges that grid companies charge customers and also provide positive effects for their customers are called tariffs. Grid tariffs are the electricity system by, for example, such as charged for the transmission of electricity and reducing peak loads in the system and using the the connection of a power line or cable network. grid more efficiently. One important prerequi- Under the Electricity Act grid tariffs must be site for this is that grid customers are actually objective and non-discriminatory, which means able to use power at different times and realise that the tariffs are to be independent of, for ex- the cost effects that could result from having a ample, which electricity supplier a customer has power tariff solution. chosen. The same category of customers is to be charged the same tariffs in the same concession Individualised grid area. cost or a Sweden price The tariffs are to be designed in a way that is Before deregulation in 1996 there was some consistent with efficient use of the grid, and ef- discussion about uniform grid tariffs between ficient electricity generation and electricity use. sparsely and densely populated areas and a need Electrical grid companies themselves set the tar- for “joint accounting” (uniform prices) for grids iff structure based on the local conditions. in densely and sparely populated areas. Today there are laws that regulate the possibility of increased joint accounting. FUTURE TARIFF STRUCTURES According to a provision in Chapter 3, Sec- tion 3 of the Electricity Act, each concession The amount of revenue permitted for grid com- area must be accounted for separately. Any ex- panies is determined by the cost of maintaining, emptions from thus rule of each concession area operating and developing the grid in the specific having separate accounts are permitted if the electricity area. The tariff structure is thus based following two criteria are met: on the conditions in the specific area and the customers in that area must carry the costs. 1. Territorial proximity, whereby the concession Today there are more than 170 electric grid areas in question must be geographically close to areas and some grid companies operate in sever- each other. This does not mean that the conces- al of them. The companies that operate in mul- sion areas must be adjoining areas. On the other tiple grid areas often have the large remaining hand, it should not be possible for joint accounting sparsely populated areas, while the grid areas to take place for all of the areas a concessionaire

45 has, but that are in entirely different parts of the holiday homes, resulting in lower electricity use. country and that would lead to fully uniform tariffs. The grid must always be available, offering the In each individual case the Swedish Energy Markets same functions and coverage. This means that the Inspectorate makes an assessment of when this costs with today’s system will be carried by fewer criterion is considered to have been met. customers, resulting in higher costs per customer. Grid tariffs vary substantially between grid 2. The other requirement is that the areas in ques- areas, partly due to geographical conditions and tion do not jointly create an unsuitable entity partly due to yield requirements and efficiency. (but should instead lead to a suitable combina- Uniform grid charges would mean the same tion of sparsely and densely populated areas). price throughout Sweden for all electrical grid companies (different for different customer The intention of the law was for tariff areas in categories). The Sweden price is based on the close geographical proximity to have similar regulation model and established parameters price levels, regardless of which grid companies on which electrical grid revenue in Sweden is are operating. Today this is not the case. Instead based. Redistribution among companies must the city grids with fewer metres of cable per cus- be implemented by an independent party. tomer that are close to a grid in a sparse area Potential consequences of a Sweden price: with more metres of cable per customer in the same geographical location have entirely differ- • All grid customers in Sweden pay the same ent tariff levels. amount for the same capacity needs, receive the Grid costs could develop in two different di- same outage compensation etc. rections, see Figure 16. • Reduced ability to control customer behaviour through tariffs, service levels etc. Individualised cost • The grid companies may drop the pricing Today customers are subsidising each other’s grids instruments and products to create more in the same electricity area. When tariffs are made satisfied customers – risk of more sluggish more uniform, transparency on what customers production development. actually pay for is reduced. The quality regula- • Connection fees are set by each respective grid tion does not differentiate and imposes the same company like today and make up a portion of the criteria – regardless of whether people live in the permitted revenue. archipelago or on top of a mountain – that all cus- • All grid companies have the same return on their tomers receive the same level of delivery reliability. investment as long as the same level of efficiency Development towards an individualised grid and delivery reliability is provided.. tariff for customers means that each customers will pay for its actual part of the grid, i.e. the Joint accounting made easier (ONE corporate rate) longer the power lines and the more complex A more immediate alternative to handle uneven the geography, the more expensive the grid tariff cost levels between densely and sparsely popu- will be. This creates a fairer alternative cost for lated areas is to make it easier for the grid com- grid connection for customers, compared to go- pany with remaining sparsely populated areas to ing off-grid (solar cells, batteries, diesel units). even out prices with population centres, partly The grid companies may need to follow in to handle the current high cost levels per cus- the footsteps of Telia, with some copper cables tomer in the grid area and partly to deal with installed underground in sparsely populated ar- the ongoing depopulation which is increasing eas where customers choose to go off-grid to use the unit price of electricity for remaining grid more cost-efficient solutions. customers in the sparsely populated area. One possible solution is to review the geographical One Swedish price proximity requirement and allow the “not to Urbanisation in Sweden is causing rural areas to form an unsuitable unit” requirement to remain be depleted of permanent residents and filled with in place to protect the customers.

46 11. Implementation times

Smaller facilities, such as solar panels and local network concession. When holding a network energy storage, can be installed quickly com- concession for an area, the grid company has pared to the multi-year processes for building the sole right to operate an electrical grid in that large conventional power plants. The faster geographical area at the voltage levels the grid pace of change among producers shortens the concession covers and, under the Electricity Act, grid operators’ planning process horizon and is responsible for connecting parties wishing to increases the need for fast project planning and feed electricity into or draw electricity from the implementation, as well as fast processing of grid. permits by the authorities. Another aspect is Regional grid companies and Svenska kraft- that the lifespan of these types of small plants nät have network concessions for lines that is shorter than the life of electrical grid, which allow them to build a power line for a certain creates a discrepancy in the planning horizon. predetermined distance. Network concessions A normal power line concession project takes apply for an indefinite term unless otherwise between 10–12 years for Svenska kraftnät to stipulated. implement. The actual construction of the line The Swedish Energy Markets Inspectorate takes about three years and the remaining time makes a determination on the fairness of con- is for the permit and planning phases. Even very nection fees. small power line projects often require a full permit process, resulting in long implementation times. Building a new station takes around 4–5 years. The actual construction of the station takes about 1.5 years and the remaining time is for the permit and planning phases. Minor work on existing stations where no new permits are needed can be done significantly faster.

THE PERMIT PROCESS

Today’s permit process creates a bottleneck in many necessary change processes. The length of the permit process should at least be more predictable. A faster process is something that society will benefit from.

Network concession An electrical high-voltage power line cannot be built or used without a permit, a so-called

47 48 12. Electrical grid technology

This report has up to now described factors af- lost reactive power after the closure of power fecting the development of the electrical grid stations. and in what ways the grid will be developed There is also a shift to an increasing amount based on these factors. The development of grid of electric energy in the form of direct current technology is also a factor that is independent in things like LED lighting and computer equip- of the external ones. Technology development ment. The increased proportion of solar is also for the electrical grid is described in this chapter. produced as direct current, and both battery technology and fuels cells are DC-based.

ALTERNATING CURRENT AND DIRECT CURRENT FUTURE TECHNOLOGY

The electricity system has been using alternat- High voltage direct current, HVDC ing current (AC) for 100 years as the dominat- The lack of potential cable corridors may lead to ing technology. Direct current (DC) has had a an increase in the percentage of HVDC because very small role, mainly in places where it has it takes less space – both in overhead lines and not been possible to construct for alternating in cables. With HVDC it is also easier to control current such as over water. In recent years di- the power flow. HVDC can be used for the longer rect current has also been used in transmis- distances, thus releasing capacity in the existing sion over long distances and with high voltages transmission grid to better manage local varia- – high voltage direct current (HVDC). Around tions, e.g. a weather front passing through, when 1–2 percent of the world’s power transmission is solar and wind can be quickly changed regionally. via HVDC, but this is increasing rapidly. Of the If the transmission grid has a high load the mar- new installations, HVDC accounts for 8 percent gins will be small when a front passes through. of transmission capacity, but the percentage is HVDC technology based on so-called VSC tech- significantly higher in Europe. The latest HVDC nology has additional benefits in that it, in ad- technology can now transfer 10 GW over 3,000 dition to power transports, is able to support km in overhead lines and 2.5 GW over 1,500 km the existing AC grid by supplying large amounts in cables (on land or in water). This technol- of reactive power, irrespective of whether there ogy may thus be an interesting alternative for is any active power going through, Because of moving large weather-dependent production this property, HVDC technology can be connect- surpluses to areas where there is a deficit. ed to very weak electricity systems, i.e. with a HVDC technology may also help raise trans- small amount of local production. Black start mission capacity in existing cable corridors. By with HVDC is a solution that is used, for exam- replacing the isolators in existing overhead lines ple, in most newer projects, most recently for and converting from alternating to direct cur- plants for Åland and Skagerak 4 in Norway and rent, the capacity in existing cable corridors can SydVästlänken and NordBalt in Sweden. In the often be raised. At the same time, controlling Caprivi link, Namibia, the AC and DC grid are the power flow is made easier and it is possible of about the same strength and can handle go- to have access to reactive power at the end of ing from transmission in one direction to insular the cables and this could, for example, replace operation in the other direction without an out-

49 Table 7: A few examples of DC land-based cable connections

Country Route length DC voltage Power Murray Link Australia 180 km 150 kV 220 MW SydVästlänken Sweden 180+10 km 300 kV 2*600 MW INELFE France–Spain 60 km 320 kV 2*1,000 MW

age occurring. Advances in control technology tion at lower voltage levels, some of the ability to will improve the ability of HVDC to adapt the regulate voltage in the transmission grid is lost. regulating ability depending on the types of pro- It may therefore be necessary to compensate for duction sources and “grid strengths.” this with passive components in combination At lower voltages an improved power semi- with components based on power electronics, conductor is introduced. Silicon carbide will so-called flexible AC technology. lower the losses in the converter stations and Voltage regulation in regional and local grids reduce the physical size of the plants if the tech- may also need to be adapted to the new produc- nology can be used for higher voltages. tion mix, a function that can to some extent be Cable technology for HVDC also deserves a included in the connection terms and conditions mention. Today 525 kV DC can be achieved and for, e.g. PV. Today in Germany it is required for in a cable pair with cables that are around 10 cm solar power inverters to help regulate voltage in thick, it is possible to transport as much power the grid when production exceeds 50 percent of as all three nuclear power blocks in Oskar- demand. This functionality allows up to 40 per- shamn can produce at maximum capacity. Such cent more solar power to be generated without high power levels are, however, not relevant to the need for grid reinforcement (IEEE Spectrum). the conditions in the Nordic systems as the dimensions of the rest of the grid are not suitable Operator support for for such large connections at a single point. weather-dependent production There is a push globally for increasing the New operating tools for operators will be needed amount of cables, mainly because of the land value for the grid of the future. The first pilot projects to be saved despite significantly higher construc- are already under way today, attempting to calcu- tion costs today. The cost calculation for a cable late the grid load a number of hours in advance to transfer includes things like the total construction discover any future problems. This information time (where the permit process for overhead lines can then be used to prepare the grid as far as pos- and cables can vary greatly), faults that can be ex- sible to avoid any problems discovered. In Spain, pected to occur during the life of the cable and for example, where there is a large amount of in- time to repair it. Although most of the problems stalled weather-dependent capacity but limited with overhead cables are not long-lasting, the over- easily controlled energy such as hydropower, pro- head cable network could be affected by prolonged gress have been made with this type of planning. disruptions after, for example, storms or ice build- up (Gudrun in 2005; France, 1999; North Ameri- Permit-controlled maintenance can ice storm of 1998). Climate change is expected One important tool to keep grid costs down is to increase the risk of extreme weather conditions. permit-controlled maintenance. By evaluating the “health” of a component and estimating its Voltage regulation operational significance, areas and components By moving generation from generators (directly can be identified where maintenance will have connected to the transmission grid) to genera- the maximum impact.

50 Smart electrical grid between the transmission and distribution grids With more wind power and solar energy in the en- could be beneficial from a grid operation per- ergy system, the technical design will be more and spective. The actual connection between IoT more important. With modern current conversion sensors and the grid relies on communication technology, wind turbines and solar energy equip- infrastructure. The internet and future systems ment can be designed to help maintain voltage such as 5G may also enable load control to bal- and frequency regulation in the electrical grid. ance production and consumption by connect- Modern IT and communication technology ing and disconnecting users. Here, the commu- can help increase the flexibility of electricity use nication network is a very important factor in adapted according to the load in the closest local maintaining operational stability. grid where the power load is high. Flexible use could also enable electricity use that tracks the Electrical grid losses electricity price variations hour by hour (or short- Energy losses in Sweden’s electrical grids collec- er periods such as every 15 minutes). Thus more tively amounted in 2014 to 8.1 TWh (national grid electricity would be used when the price is low 3.0 TWh, regional grids 1.6 TWh and local grids and less when the price is high in the electricity 3.5 TWh). The main factors influencing the size of market. Connected appliances and devices in the grid losses are the length of the power lines/cables, home could receive information on current and the cable dimensions (the thicker the line or cable, upcoming electricity prices on an hourly basis. the lower the losses), voltage level (higher voltage, Through more advanced grid tariffs the grid load lower losses) and the phase angle of the current itself could also determine how energy is used by relative to voltage (reactive power). The losses are the electricity users’ connected equipment. in direct proportion to transmitted energy. In the future it may be necessary to expand The losses in the grid may vary significantly the electrical grid for HVDC. This would enable from year to year based on how large the total there to be grid cables for the highest voltages as consumption is and what the operational situ- well. This will require circuit breakers for direct ation is like. The losses will increase with the current as well as advanced control and moni- transmission of large amounts of hydropower toring equipment. from north to south. But smart grids are also about better moni- Operational optimisation to minimise losses toring and control of the grid’s components. is an area which has historically always attract- In the future more and more switchgear could ed a lot of attention. In grid operation, voltage be controlled remotely to reduce the duration regulation and reactive power compensation are of outages. Certain actions could be performed two important factors in limiting grid losses. entirely automatically using software. When expanding the electrical grid, the dimen- Cooling of overhead lines depends on the ex- sions of the power lines are determined by the external temperature, wind etc., and the amount tent of the losses the new line will contribute to. of power needed can therefore vary greatly. By An increased percentage of local production measuring or predicting the cooling need, the would mean energy being transferred over a cables could be used closer to their actual cur- shorter distance before reaching the user, creat- rent limits. More advanced or simpler solutions ing the potential to reduce losses in the local grid. could be used for this. Lower usage will, on the other hand, increase the pressure to optimise plant dimensions. When ca- Sensors and the internet of things (IoT) pacity utilisation increases, so too will the losses. Sensors in the grid mainly allow temporary in- With the increasing importance of large-scale creases in the capacity of the electrical grid. Up hydropower in the north, in three of the four to 20 percent of extra capacity has been report- production alternatives, the need for transmis- ed. This possibility will be increasingly impor- sion from north to south will increase as well, tant with an increased proportion of weather- and losses will increase unless transmission ca- based generation in the system. Coordination pacity is expanded.

51 52 13. Appendix

REFERENCES

Båge, H., Så funkar elnätet. (Illustration) SCB, Varannan svensk bor vid havet (2016). Taken from http://www.scb.se/sv_/Hitta- Elforsk. (2012). Prosumer med Demand- statistik/Artiklar/Varannan-svensk-bor-nara- Response, makroperspektivet. havet/

Elforsk. (2014). Framtidens krav på elnätet. Statens Energimyndighet. (2007). Elanslutning av vindkraft till lokal-, region-, och stamnätet. Energimarknadsinspektionen. (2014). En elmarknad i förändring. Svensk Energi. (2015). Ett modernt elnät behöver nya investeringar. Energimarknadsinspektionen. (2014). Leveranssäkerhet i elnäten 2012. Svensk Energi. (2015). Potential att utveckla vattenkraften – från energi till energi och IEEE Spectrum. Taken from http://spectrum. effekt. ieee.org/green-tech/solar/how-rooftop-solar- can-stabilize-the-grid Svenska kraftnät. (2013) Perspektivplan 2025 – En utvecklingsplan för det svenska stamnätet IVA. (2015). Energy storage. Svenska kraftnät. (2015). Kraftbalansen på den IVA. (2015) Elproduktion Tekniker för svenska elmarknaden. produktion av el. Svenska kraftnät. (2015). Nätutvecklingsplan IVA. (2016). Future Electricity Usage 2016–2025. – A project report. Svenska kraftnät. (2016). IVA. (2016). Sweden’s Future Electricity Taken from www.svk.se production – A project report. Svenska kraftnät, balansansvar. (2016). Electricity Distribution and Transmission work Taken from www.svk.se/stamnätet/drift-och- group, 2016. The work group’s knowledge, marknad/balansansvar experience and calculations. Svenska kraftnät, nätutveckling. (2016). Andersson, K., Komponentuppdelning av Taken from http://www.svk.se/natutveckling/ elnätet på lokalnivå, 2008 utbyggnadsprojekt/

SCB. Det var en gång en tätort (2016). Taken from http://www.scb.se/sv_/Hitta-statistik/ Artiklar/Det-var-en-gang-en-tatort/

53 ABBREVIATIONS

DSO AC Distribution system operator Alternating current

TSO DC Transmission system operator Direct current

HVDC PV High voltage direct current Photovoltaic (solar cells)

VSC Voltage source converter

EXPLANATIONS OF CONCEPTS AND TERMS

“PA More solar and wind” Electricity supplier Production alternative 1 – More solar and wind Electricity suppliers are companies that pur- chase electricity from electricity producers “PA More bioenergy” and sell it under various types of contracts to Production alternative 2 – More bioenergy electricity users. There are many electricity suppliers, which means there is competition for “PA New nuclear power” the electricity supply. Production alternative 3 – New nuclear power Power market “PA More hydropower” The Nordic power market (Nord Pool Spot AS) Production alternative 4 – More hydropower organises trading in electricity for physical delivery, i.e. the spot market for both day-ahead Electricity users (DA) and intra-day (ID) trading. An electricity user signs a contract with an electrical grid company for the transfer of elec- Exchange tricity and with an electricity supplier for the The Nasdaq OMX Commodities exchange supply of electricity. organises a futures market (financial trading) for electricity trading with a long-term per- Electricity producer spective. An electricity producer generates electricity and signs contracts with electrical grid companies to feed electricity into the grid, and signs contracts for the sale of electricity.

54 in cooperation with