Swedish National Energy Administration Energy in Sweden Is Published Annually, in Swedish and English, by the Swedish National Energy Administration

Swedish National Energy Administration Energy in Sweden is published annually, in Swedish and English, by the Swedish National Energy Administration. A special version, containing only the tabular data, is also available. In addition, the diagrams can be ordered from the Energy Administration in the form of a set of overhead pictures. Energy in Sweden, together with a number of other publications of current interest, can be ordered from the Energy Administration. Further general information is available from the Energy Administration’s External Communications Department. Statistical information has been provided by, and is available from, the Department for Energy Policy Analysis. For general statistics, contact Becky Petsala: for information on the electricity market and the power production system, contact Anna Lagheim: for district heating and district cooling, contact Maria Stenkvist: for the biofuels market, contact Stefan Holm: for the oil and coal markets, contact Claes Aronsson: for energy gases, contact Agnes von Gersdorff: for the residential and service sectors, contact Caroline Hellberg: for industry, contact Niklas Johansson: for the transport sector, contact AsaLeander: for prices and taxes, contact Agnes von Gersdorff, and for environmental aspects, contact Stefan Sedin. ET 36:2000 Project leader: Karin Hermanson, e-mail: karin.hermanson@ stem.se Production: Ordfoi6det Beail Ortenstrand AB Translation: Angloscan Manuscript Ltd. Assistant project leader: Asa Leander, e-mail: [email protected] Winted by: Alfa-Piint AB, Sundbyberg Wint mn: 8 000 copies. Our telephone number is +46 16 544 20 00. December 2000 Further information on the Energy Administration and its publications is available at Photo page 40: Mikael Ull~nlOrange Cover photogaph Hasse Cedergran wwwstemse. The energy markets are undergoing a process the conditions for efficient use and cost-effi- of rapid change as a result of many factors, cient supply of energy, with minimum adver- including a shift in the emphases of energy se effects on health, the environment or cli- and environmental policies in Sweden and mate, while at the same time assisting the elsewhere. ‘Energyin Sweden’, which is pub- move towards an ecologically sustainable so- lished annually, is intended to provide deci- ciety. An extensive energy policy program- sion-makers, journalists and the general pu- me has been started in order to facilitate blic with a coherent and easily available sour- restructuring and development of the energy ce of information on developments in the en- system. The main thrust of this work is in the ergy sector. form of a substantial long-term concentration In recent years, Swedish energy and en- on research, development and demonstration vironmental policy has increasingly concen- of new energy technology. The National En- trated on establishing or improving long-term ergy Administration is responsible for imple- conditions for effective energy markets. menting most of the energy policy program- Restructuring of the Swedish electricity mar- mes and for coordinating the work of restruc- ket, greater internationalisation and the effects turing the energy system. In addition, it is also of the energy system on the environment and responsible for monitoring developments in on climate are important factors that influen- the energy and environmental sectors, and for ce this policy and thus the development of providing information on the current energy energy markets. Sweden’s presidency of the situation, such as changes in the structure and European Union from 1” January 2001 will pattern of energy supply and use, energy pri- be an important event. Sweden takes over the ces and energy taxes, as well as the effects of presidency from France and, at the end of its the energy system on the environment. six-month period, hands over to Belgium. A number of changes have been made in Sweden’s energy policy, as set out by the this year’s edition of Energy in Sweden. Two SwedishParliament in 1997, is to provide se- new sections have been added: a description cure short-term and long-term supplies of elec- of various areas of current policy, and a des- tricity and other energy on sufficiently com- cription of energy supply within the Europe- petitive terms to enable the country to com- an Union. The descriptions of the national and pete with supplies from other countries. The international oil, coal, electricity and gas mar- country’s energy policy is intended to create kets have been merged into joint texts. s

Stockholm, december 2000

Thomas Korsfeldt Becky Petsala Director-General Head of Department, Department for Energy Policy Analysis Contents

THE ENERGY SYSTEM Energy in Sweden 7 999 - an overview 3 Current Policy Areas 4 Total Energy Supply 6 Total Energy Use 7 The Electricity Market 8 Biofuels, Peat etc. 72 District Heating and District Cooling 74 The Oil Market 76 The Coal Market 78 The Energy Gas Market 79 Residential, Commercial, Service Sector etc. 27 Industry 23 Transport 25 Energy Supply in the European Union 26 World Energy Resources and Energy Use 28

TAXES AND PRlCES Taxes and Prices 30

THE ENVlRONMENTAL SlTUATlON ______Energy and Environment 32

GENERAL A Glossary of Energy Terms 38 Units and Conversion factors 40 Energy in Sweden in 7999 - an Overview

3 he form taken by energy, envi- (SOU 2000:23), in which it suggested a na- the markets are to be opened up and what ronmental and climate policies, tional target for Sweden involving reducing rules are to apply on them. The electricity both at national and internatio- the emission of greenhouse gases by 2 % markets in the UK, Norway, Sweden, Fin- nal levels, will have a very considerable ef- between 2008-2012, relative to the 1990 le- land and Germany are already fully open to fect on future development of the energy vel. To achieve this objective, the Commit- competition, i.e. both industrial and domes- sector. Since joining the European Union, tee suggests a programme of work at both tic consumers can choose their electricity Sweden has also participated in the work of national and international levels. One of the suppliers. Market restructuring is well ad- advancing matters of common European in- elements of the international work is that vanced in Denmark, too, but other EU terest in the fields of energy and transport. Sweden should push for the introduction of countries have not progressed as far. In its capacity as a member state, for ex- European trade in emission rights of green- The emphasis of the work on how deve- ample, Sweden participates in the EU Frame- house gases. At the national level, work in- lopment of transport and energy can be re- work Programme for research and develop- cludes information campaigns linked to de- conciled with environmental requirements is ment, of which one of the working areas is monstration projects and investment subsi- on a number of areas, including energy effi- concerned with renewable energy sources dies. Some proposals also involve tightening ciency (particularly within the building sec- and more efficient use of energy. up existing regulations. tor) and on encouragement of the use of re- During the spring of 2001, Sweden will Emission Trading:A Way ofAchieving the newable energy sources. A draft directive hold the presidency of the EU. The main duty Climate Goal (SOU 2000:45) was published was presented by the Commission in the of the chair country is to conduct the work of in the spring of 2000. The report concentrates spring of 2000, intended to encourage the the European Union and to further matters of on how a national trading system in emission production of electricity from renewable common interest. It will also mean that Swe- rights could be established: the Government energy sources (COM [2000] 279 Final). The den will represent the European Union in con- will be presenting a Bill concerned with cli- purpose of the directive is to create a frame- tact with other countries and in international mate matters at the end of 2000. work which, in the long term, will help to contexts. During its presidency, Sweden in- increase the proportion of electricity produ- tends to give priority to three matters in parti- EU /eve/ ced from renewable energy sources. The cular: enlargement of the EU, employment The EU Directorate-General for Energy and Commission’s White Paper Energy for the and the environment. (Read more at: http:// Transport has established a number of poli- future - renewable energy sources (COM www.utrikes.regeringen.se/eu.) tical priorities for the period 2000-2005. [1997] 599 Final) sets out the objective of Some of these priorities relate to implemen- doubling the present proportion of electrical National tation of the single market for energy and energy from renewable energy sources wit- In both the long and the short terms, the ob- transport, as well as to the question of how hin the EU from 6 % to 12 % by 2010. jective of Swedish energy policy is to ensu- development of the transport and energy sec- For the summit meeting of the Council re reliable supplies of electricity and other tors can be reconciled with environmental of Ministers in June 2001, the Commission forms of energy carriers at prices that are requirements. is planning to put forward a strategy for in- competitive with those of other countries. It The objective of implementing the sing- tegrating environmental consideration and is intended to create the right conditions for le market for energy and transport is sup- sustainable development within the energy cost-efficient Swedish energy supply and ported by a number of measures, including sector. It represents a continuation of the efficient energy use with minimum adverse the gas and electricity market directives. The progress started in Cardiff in 1998, with the effect on health, the environment or clima- Electricity Market Directive (96/92/Eu) was aim of increasingly integrating environme- te. Extension of cooperation in the fields of adopted in 1996, followed by the Gas Mar- ntal protection requirements and sustainable energy, the environment and climate around ket Directive (98/3O/EU) in 1998. Their ob- development in areas such as energy and the Baltic is also an important objective. jectives are progressively to open up the gas transport policy. The environmental aspects (Read more at: http://www.regeringen.se.) and electricity markets to greater competi- will be given priority while Sweden holds The results of two climate official reports tion, which is expected to benefit European the presidency of the EU. have been published during 2000. During the consumers through lower prices. At present, The Commission has also published a spring, the Climate Committee published its the Commission is working on preparing Communication (COM [1999] 548 Final) Proposal for a Swedish climate strategy data and putting forward proposals for how concerning strengthening the northern di- Current Policy Areas

mension of European energy policy. It was The Directorate-General for the Environ- International noted, at the meeting of foreign ministers in ment has also published a Green Paper en- The sixth meeting of the parties to the Cli- Helsinki on 11-12 November 1999, that the titled Greenhouse gas emission trading wit- mate Convention, COP6, was held in the northern dimension can be utilised to increa- hin the EU (COM [2000] 87), intended to autumn of 2000. The main objective of this se security, stability, democratic reforms and start a discussion on trade in emission rights, meeting was to enable the parties to make sustainable development in northern Euro- including discussion of how such a system decisions concerning the various matters re- pe, as well as to identify and encourage com- might be structured. It is the objective that a maining to be solved, including utilisation mon European interests. During 2000/2001, trading system should be in operation wit- of the flexible mechanisms. The meeting the Commission is planning to publish a hin the EU by 2005. considered, for example, what sanctions Green Paper on security of supply in the During 2000, the Directorate-General for should be applied to countries that did not energy sector. the Environment introduced a European cli- fulfil their emission undertakings. Another The work of the EU Directorate-General mate change programme, ECCP. The objec- important issue was how the carbon sinks for the Environment includes climate matt- tive of the programme is to bring together all should be handled. The results of this meet- ers. During the year, the Commission has parties involved in work on preparations for ing are decisive for the coming Kyoto Pro- published a communication on EUpolicies common, coordinated policies and measures tocol ratification process. As it turned out, and measures to reduce greenhouse gas intended to reduce emissions of greenhouse the Parties to the Kyoto Protocol did not emissions (COM [2000] 88), as a precursor gases. The programme will be concerned pri- reach a final agreement on some of the more to ratification of the Kyoto Protocol. It is par- marily with policies and measures within the difficult issues. The negotiations will thus ticularly within the fields of energy, trans- fields of flexible mechanisms, energy supp- continue in spring 2001. F2 port and industry that common matters, con- ly, energy use, transport and industry. cerning the whole of the European Union, can be of interest. Total Energy Supply

Sweden’s total energy supply has increased in 1970 to 14 % in 1999. Biofuels, peat etc. sidised by grants administered by the Natio- by 36 % between 1970 and 1999, from 457 are used primarily by the industrial sector and nal Energy Administration. TWh to 615 TWh’ respectively. The avera- for district heating production. According to the Administration’s forecast ge level of energy supply has been 534 TWh/ Total energy supply varies from year to for the period until 2002’, total energy supply year. year due partly to the effects of temperature. for 2000 is expected to fall to 589 TWh. This The constituents making up the total ener- Years that are warmer than the statistically is due primarily to a reduction in the supply gy supply have changed considerably over this normal value have a lower energy supply, of oil, due to high oil prices and a fall in nu- period. In 1970, crude oil and oil products while those that are colder have a higher en- clear power output. Despite the fact that hy- accounted for 77 % of the total energy supp- ergy supply. 1999 was warmer than normal, dro power output has been unusually high, it ly, but had fallen to 33 % by 1999. In 1970, which means that energy use, and thus ener- is expected that overall electrical production most of the oil was used by the residential and gy supply, was less than would otherwise have will fall to 141 TWh as a result of reduced service sectors. Today, the largest user is the been the case. production of nuclear power. It is expected, transport sector, accounting for 54 % in 1999. Compared with other countries, Swedish on the basis of preliminary statistics and our Over the last 30 years, the use of oil has been energy supply comes from a relatively large own calculations, that Sweden will be a net largely replaced by the use of nuclear power proportion of renewable energy sources: bio- importer of 4.6 TWh of electricity during and biofuels, accompanied by an increase in fuels, hydro power and wind power. In 1999, 2000. According to the forecast the total en- the ‘normal year’ production of hydro power. these sources provided 26 % of the country’s ergy supply for 2001 and 2002 is expected to Normal year output is based on a mean value total energy supply. In order further to in- rise to 609 TWh and 616 TWh respectively: of statistics concerning inflow to the reser- crease this proportion, investments in wind including respective net imports of electrici- voirs for the period 1950-1996. Today, nu- power and biofuelled CHP plants are sub- ty of 9 TWh and 10 TWh. a clear power can produce about 206 TWh’ (68 TWh of electricity) per year, and hydro power can produce about 64 TWh per year un- wh Figure 2a 9 Tor01 energy supply in Sweden 1970-1999 der normal precipitation conditions. The total 700 proportion of overall energy supply provided by hydro and nuclear power has increased from 9 % in 1970 to 46 % in 1999. The proportion of total energy supply provided by coal and coke in 1999 remains at the same level as in 1970, i.e. 4 %, while the proportion sup- lied by biofuels, peat etc, has risen from 9 %

I In accordance with the international method of energy accounting, which includes the energy con version losses in nuclem power stations. Energy supply in Sweden, shoi-t-termforecast, 2000.1 1-02.

Figure 9 Energy supply in Sweden energy carriers N\ch 2b by 400 Crude oil and oil products Natural gos Gal and coke Biofuels, patetc. Total Energy Use

Total energy use can be divided up into th- The variations in energy use that occur According to the Administration’s fore- ree categories. First is what is known as the from year to year are due mainly to econo- cast for the period up to 2OOz3, total energy total final energy use, i.e. use within the th- mic conditions and to climate conditions. use for 2000 is expected to fall to 589 TWh, ree sectors of residentialkervices etc., indu- The reduced energy use in the residential/ despite the fact that final energy use is ap- stry and internal transport (i.e. excluding service sector during the end of the 1980s proximately the same as in 1999. The ex- international marine bunkers). The three sec- and the beginning of the 1990s can be partly planation for this is that the cutback in elec- tors in this group account for the majority of accounted for by the fact that those years tricity production from nuclear power plants all energy use. The second category com- were warmer than normal. 1996, however, will also result in an estimated reduction in prises the losses associated with total ener- was colder than normal, which explains the the total losses to 159 TWh. gy use, i.e. conversion losses in connection increase between 1995 and 1996. The follo- Energy use in the industrial sector is ex- with electricity and heat production (alt- wing years were again warmer than normal, pected to increase by 5 TWh during 2000, hough this does not include the losses asso- resulting in a fall in energy use in the resi- while energy use in the transport sector is ciated with hydro power production), con- dentiallservice sector. expected to remain the same as it was during version losses in refineries and coking plants, Total final energy use in 1999 amounted 1999. Energy use in the residentialkervice energy used by the energy sector itself and to 393 TWh. To this must be added 36 TWh sector is expected to fall, due to the fact that distribution losses associated with the supp- for overseas shipping etc., and 186 TWh for 2000 was warmer than 1999. ly of electricity, natural gas, gasworks gas, losses, of which the losses in nuclear power According to the forecasts for 2001 and blast furnace gas and district heating. The plants accounted for 140 TWh. This gives a 2002 final energy use is expected to increase third category of energy use comprises bun- total energy use of 615 TWh for 1999. to 402 TWh and 404 TWh respectively. ker oil for international shipping, coal and oil products used as raw materials and feed stocks for applications such as the plastics industry, lubricating oils and oil products Wh Figure 3a Total energy use in Sweden 1970-1999 used in the building and civil engineering 700 sectors, e.g. asphalt, surface coatings etc. The relative proportions of final energy use accounted for in the first group have gradually changed since 1970. The residential/ service and industrial sector proportions have each fallen in relation to total final energy use, while that of the transport sector has risen. Industry’s proportion has fallen from 41 % to 38 %, and the residentialkervice sector from 44 % to 38 %, while the internal transport sector’s proportion of the country’s total energy use has risen from 15 % to 22 %.

Energy supply in Sweden, shoi-t-term forecast, 2000.1 1-02.

service sector etc. use for non-energy purposes The Electricity Market

1999 was the fourth year of the restructured electricity for heating, coupled with greater conventional thermal power plants. In this electricity market in Sweden and Finland. use of electricity for building services sys- context, thermal power refers to combined Norway had restructured its electricity mar- tems. heat and power production, cold condensing ket in 1991. During the year, competition In industry, use of electricity has increas- power production and gas turbines, but not on the market increased more than it had ed on average by 1.8 % per annum since nuclear power. Combined heat and power done during the three previous years. A good 1970. Industrial use is closely linked to pro- plants are employed in industry, where the availability of electricity, together with low duction conditions in a small number of im- heat is used for internal process require- prices on the electricity exchange, exerted portant sectors: the pulp and paper industry, ments, and in district heating plants, where pressure on the utilities to keep their prices for example, uses about 41 % of all the elec- the heat is generally supplied to public di- down. tricity used in industry. Electricity use in the strict heating systems. Since the restructuring of the industry, transport sector is relatively small, being At the beginning of the 1970s, most of there have been a number of changes in re- used almost entirely by the various forms of Sweden's electricity was being produced by spect of ownership of the production utili- rail transport. In addition, total electricity use hydro power and conventional thermal po- ties in the Nordic countries. Gullsphg Kraft includes the losses associated with the trans- wer. This was when expansion of nuclear and Stockholm Energi merged in Septem- mission of electricity, together with electri- power started, with Sweden's first commer- ber 1998 to form Birka Energi, which me- city used in district heating plants, CHP cial reactor, Oskarshamn 1, being commissi- ans that Sweden now has six main parties plants and refineries. oned in 1972. Since then, the proportion of dominating the electricity production sector. electricity from nuclear power has grown sub- However, on the common Nordic market as Electricity production stantially, so that from 1975 more electricity a whole, there are several other production Electricity is produced in Sweden from hy- has been produced in nuclear power plants utilities that compete. Swedish Vattenfall, dro power, nuclear power, wind power and than in conventional thermal power plants. Norwegian Statkraft, Finnish Fortum and German PreussenElektra all want to be le- Wh Figure 40 Use of electricity in Sweden 1970-1999 ading companies in a future northern Euro- 200 pean electricity market, and are therefore investing in facilities in their neighbouring countries. This action is manifesting itself in such ways as through takeovers, purchase of shareholdings, alliances and the esta- industry blishment of subsidiary companies in Swe- den and in other countries. 100

Electricity use Tmnspart ...." Total electricity use increased by only 0.3 % per annum from 1987 to 1999, to a total of 50 somewhat over 143 TWh in 1999. The gre- Residential, commercial, service sector etc. atest increase is to be found in the residential and service sector, in which the use of elec- ...... tricity varies with temperature. The increa- 70 75 80 85 90 95 99 se is due primarily to a change from oil to Today, most of Sweden’s electricity is Nordic market has become more efficient, teral agreements. Border tariffs have been produced by hydro power or nuclear power, as the transaction costs have been reduced. removed between Norway, Sweden and Fin- with conventional thermal power production In addition, the exchange price can be used land, which has also helped to improve the accounting for only about 5 %. Oil-fiied cold as a reference price for trade under the bila- efficiency of trading. Electricity in the condensing power plants and gas turbines are used today primarily as reserve capacity Figure 5 Wind power production 1982-1999 during years with low precipitation and re- ...... so0 ...... :::: sulting low hydro power production...... :::: ...... Number of wind power plants ...... :j:j:j:j Restructuring of the electricity market has ...... resulted in several reserve power stations being taken out of use for economic reasons. There are also about 500 wind power plants in the country (as of August 2000). As yet, however, their contribution to the country’s electricity balance is still very small, amounting to 0.2 % during 1999. The total installed capacity of the Swe- dish electricity production system is somewhat over 30 000 MW. However, 100 % capacity is never available, and transmission capacity between the north and south of the country is limited. The normal transmission capacity means that 6 300-7 000 MW can lWn Figure 6a Electricity production in Sweden 1970-1999 be transferred from north to central Sweden, 200 and 3 350 MW from central Sweden to southern Sweden. In 1999, the country produced 151 TWh of electricity, of which 47 % was produced by hydro power and 46 % by nuclear power.

Trade in electricity Prior to restructuring of the electricity market in the Nordic countries, trade between them was controlled by bilateral agreements between purchasers and sellers. Today, this arrangement has been complemented by a Nordic power exchange, Nord Pool, on which the price of electricity for each hour of the day is determined 24 hours in advance. As a result, pricing of electricity on the The Electricity Market

Nordic electrical system is produced in tho- GWn per week Fgure 7 Sweden's electricity imports January 1999-July 2000 se plants having the lowest production costs. MI0 This has meant that power stations having high production costs have been closed because they are no longer profitable on an efficient market. Instead, power utilities import electricity from the neighbouring countries in this open Nordic market. A condition for proper operation of the electricity market is that all parties should have free access to the transmission systems. At the same time, there needs to be a grid operator who, independent of the other parties on the market, ensures that there is a balance of power input and power demand on the grid. In Sweden, the grid operator is Svenska Kraftnat, with responsibility for the country's backbone grid and for most of the links with Sweden's Nordic neighbours. Links between the Nordic countries have GWh per week Figure 8 Sweden's eledricily exports January 1999-July 2000 been reinforced in recent years, and a cable 600 between Sweden and Poland was commis- ...... Germany ...... sioned during 2000...... As a result of changes in the electricity markets in the four Nordic/Scandinavian countries, Swedish producers can now sell electricity directly to customers in Denmark, Norway and Finland. In the same way, Swe- dish customers can purchase electricity from suppliers in other countries wanting to establish a foothold on the Swedish market. To- day, several Swedish electrical trading companies have long-term contracts for the import and export of electricity with producers in neighbouring Nordic/Scandinavian countries. Long-term contracts with customers in other countries are also becoming more common. Trade in electricity between the countries Price developments electricity market. The price varies over the varies not only during the year but also from The prices of electricity vary between custo- year. Since 1998, these variations have follo- year to year, depending on the weather and mer categories, between urban and rural are- wed a similar pattern, being higher during the on economic conditions. However, the most as and between the Nordic countries. This is winter and lower during the summer. The pri- significance influence on the overall direc- due to varying transmission costs across regi- ce variations depend on precipitation quanti- tions of power flow is the amount of water onal and local transmission and distribution ties, temperatures and available production in the Swedish, Norwegian and Finnish re- systems, different taxation regimes, subsidies, and transmission capacities. servoirs, coupled with electricity production national rules and the structure of the electri- Due to physical limitations on the links costs. German, Russian and Polish utilities city market. The spot price of electricity on between Sweden and Norway, two different also participate in electricity trading with the the power exchange is not the price that pri- prices, known as areaprices, have been app- Nordic countries, although they are not able vate customers see on their electricity bills. lied on occasions. During 1999 and 2000, to trade on the Nord Pool. As yet, trade with The final price of electricity to a customer these differences were greatest during the these countries is still relatively small. consists of a grid tariff, a price for the electri- summer, when the prices in Sweden were During the first half of 2000, Sweden's cal energy itself, various charges and taxes higher than those in Norway. In addition, electricity trade changed from a net export and, finally, the profit margin applied by each major differences occurred on 24" January to a net import, despite plenty of water in link in the chain. The spot price is determined 2000, when the Swedish and Finnish area the reservoirs and high availability of the on the basis of an equilibrium price as indica- prices rose steeply during the morning, nuclear power plants. One explanation for ted by the intersection of the supply and dem- reaching their hitherto highest level. This this could be that the power companies have and cost curves, and is used as a reference was caused partly by the fact that it was a started to match their production to spot pri- price for other trading in electricity. cold winter day, and partly by a significant ces. During the spring and summer, for ex- The first year of the restructured electrici- fear of insufficient capacity. ample, the price of electricity on the Nord ty market, 1996, was a dry year, which meant Pool was so low that it undercut the pro- that the spot price rose until the end of the Internationaldevelopment duction costs from most forms of produc- year. Since then, it has fallen substantially, The electricity market is at present under- tion. due partly to adequate precipitation and part- going extensive changes in many parts of ly to increasing competition on the common the world in terms of altered market condi- The Electricity Market tions, new technology and greater environ- Figure 9 .Specific electricity use per inhabitant, 1998, mental awareness. One of the effects of the kWn with breakdown by power source EU Electricity Market Directive is that at 30000 least 25 % of electricity markets in the EU states must be open for competition. The degree of openness varies between states. The electricity markets in Sweden, Finland, Norway, the UK and Germany are fully open to competition, which means that all companies and households are free to choose their electricity suppliers. France, Greece, Portugal and Austria, on the other hand, have merely fulfilled the minimum requirements of the directive. The directive also affects other countries in Europe, and particularly those that have applied for EU membership. Decisions on, or advanced plans for, reform of their electricity markets also exist in several countries outside the EU. A similar development can be seen in other countries, such as South America, south-east Asia and Oceania. The USA has ve is therefore being prepared at present, with Canada, Norway and Finland also have high also started a restructuring process, under a view to requiring electricityproduction from proportions of energy-intensive industries. All which California was the first state to reform renewable sources to have been increased these countries participate in the internatio- its electricity market in 1998. from somewhat less than 14 % to over 22 % nal division of labour exporting a high pro- Restructuring of the electricity markets by 2010. The necessary financial support for portion of the products of these industries. involves a change from national monopolies, electricity producers using renewable energy Sweden is one of the world’s countries with central planning, to markets exposed sources can be provided by traditional invest- that have a high proportion of hydro and to competition. Electricity becomes a form ment support, by fixed price systems’, ‘green nuclear power in their electricity production. of energy raw material, which can be traded certificates’ etc. The certificates would prov- Only Iceland, Switzerland, Norway and Ca- and supplied across borders. ide the producers of electricity from renewa- nada have higher proportions of hydro po- Company takeovers in the electricity ble sources with the necessary financial sup- wer, while France and Belgium have higher markets in the Nordic countries have attrac- port in order to be able to meet current elec- proportions of nuclear power. Most of the ted considerable attention in recent years. tricity prices, while also providing an incen- world’s electricity is produced by conven- Strategic investments are being made by the tive for cost-efficient production. tional thermal power plants, i.e. CHP plants largest Nordic power utilities, not only in the and cold condensing plants. They are fuel- Nordic countries but in the rest of Europe, Electricity use varies between countries led almost exclusively by fossil fuels, with while non-Nordic companies, such as the In Sweden, per-capita electricity use is rela- the proportion of such fuels varying between German PreussenElektra and the French tively high in comparison with that of other 90 % and 100 % in most countries. There EdF, are investing in the Nordic countries. countries. In 1998, Sweden was in fourth are a few exceptions: in Finland and Swe- Import and export of electricity have pre- place after Norway, Iceland and Canada. den, the use of biofuels and refuse for ther- viously been clear concepts that have been Electricity use in the USA was about 15 % mal power production amounts to about defined on a national perspective. However, less than in Sweden. Among the industriali- 30 %, while in Switzerland 50 % of total as the larger companies increasingly extend sed European countries, such as Germany, thermal power production is based on such their activities across national borders, it France and the UK, per-capita electricity use fuels. However, in international terms, the becomes less relevant to talk of national elec- was less than half that in Sweden. proportion of electricity production in Swe- tricity markets. Large companies are buy- A feature common to the countries with den and Switzerland based on thermal po- ing and selling electricity in many other high per-capita electricity use is that they wer is small, amounting to 6 % and 4 % re- countries besides their original homelands. have had plentiful supplies of cheap hydro spectively in 1998. In the EU member states Development will be towards a common power. In addition, the relatively cold cli- as a whole, over half of electricity produc- market, with electricity being produced mates in these countries has meant that the- tion is based on thermal power, with some- wherever it is physically and economically re has been substantial use of electricity for what over 30 % from nuclear power and only most appropriate. heating. In Sweden, it has been other natu- 14 % from hydro power etc. ral resources, such as the forests and iron Total electricity production in the Euro- Electricity from ore, that have resulted in industry speciali- pean Union is about two-thirds of that in the renewable sources sing in energy-intensive products. If we re- USA. At the same time, the USA’s produc- Restructuring of the electricity markets and move the electricity demand of these elec- tion of electricity constitutes somewhat over natural gas markets in Europe are important tricityintensive industries from the statistics, 40 % of the total production of the OECD steps towards an internal energy market with i.e. if we replace the electricity that they use countries. Electricity production in Sweden greater competition and lower prices. Howe- by the amount of electricity that is average accounts for somewhat less than 2 % of ver, as a result of at present unavoidably hig- for industry as a whole, then the per-capita OECD production, and 6 % of EU produc- her production costs, electricity from renewa- electricity use is reduced by about 15 %. tion. E? ble sources may find it more difficult to break into the competitive markets. A draft directi- I Suppliers of electricity from renewable sources receive a fixed payment, determined in advance. Biofuels, Peat etc.

During 1999, the use of biofuels, peat etc. In 1999, the pulp industry used a total of tential within the industrial sector for incre- amounted to almost 94 TWh. These fuels are 6.7 TWh of wood fuels in the form of by- asing the use of (primarily) salvaged wood mainly indigenous, and consist of wood fu- products for energy production, while saw- fuels, which at present are not used for ener- els (logs, bark, chips and energy forest), mills and other woodworking industries used gy production. Some fuels of this type, such black liquors in pulp mills, peat (included in 9.8 TWh of wood fuels. as refuse and salvaged timber, have been the concept of bioenergy), straw and energy imported in recent years, but the quantity is grasses and refuse. District heating plants difficult to estimate. These fuels are used mainly in the forest A total of over 26 TWh of biofuels, peat etc. The use of peat in 1999 amount to 2.8 products industry, district heating plants, the were used for heat production in district hea- TWh, which is 0.3 TWh less than during the detached house sector and for electricity pro- ting plants in 1999. Of this, wood fuels ac- previous year. Production is dependent on the duction. counted for 15.7 TWh, unrefined tall oil and weather, and can therefore vary from year to black liquors for 1.6 TWh, refuse for 5.1 year. Production of peat for energy purposes The forest products industry TWh, peat for 2.8 TWh and other fuels for in 1999 amounted to 2.7 million m3, which is For economic reasons, the forest products 1.0 TWh. about the same as average harvests during the industry uses the by-products from various The use of wood fuels by the district hea- 1990s, and represents a substantial increase manufacturing processes for the production ting sector has more than quadrupled since in relation to production in 1998, when the of heat and electricity. Black liquors remain- 1990. In 1999, use rose by 0.5 TWh relative weather was particularly unsuitable. ing after chemical processing of wood to to the previous year. The main form of these Energy crops, such as energy plantations, produce wood pulp are burnt to recover che- fuels is felling waste and forest by-products. straw and grass fuels have been used since micals. However, processed fuels, such as briquet- the beginning of the 1990s, although such Black liquors, which can be produced and tes and pellets, together with unrefined tall use is still relatively limited. About 0.1 TWh used only within the pulp industry, provided oil, have also been increasingly used in re- of energy plantation fuels were used during almost 34 TWh of energy (excluding elec- cent years, amounting to a total of 4.1 TWh the year, complemented by lesser quantities tricity production) in 1999. Wood fuels in the in 1999. of straw and energy grass. Although there is form of raw materials residues are used in Refuse has been used for district heating considerable potential for greater use, the both the pulp industry and in sawmills. They production since the 1970s, and provided 5.1 area planted with such crops has remained consist mainly of wood chips, bark and oth- TWh of energy in 1999. Improved sorting almost unchanged in recent years, amoun- er waste products. Use is also made, although at source may reduce the potential quantity ting to only about 14 000 hectare in 1999. to a lesser extent, of wood fuels produced by of domestic refuse available for use as fuel, The amount of land used for energy planta- on-site forest chipping of felled wood unsu- although at present the supply of combus- tions depends largely on agricultural subsi- itable for other commercial purposes. tible waste exceeds capacity. There is po- dy rules and the amount of the subsidies.

Wn Figure 10a * Use of biofuels, peat etc. in industry 198G1999 60

Wn Figure 1Ob Use of biofuels, peat etc. in industry by types of fuel

Pulp indusiri black liquors Pulp industry byproducts, oher Biofuels for electricity production Sawmill industry byproducts Biofuels, Peat etc.

There has been a relatively extensive com- Electricity production have a considerable effect on their use: good mercial importation of biofuels during the 3.5 TWh of biofuels were used for electrici- availability of forests, an efficient forest pro- year, in the form of materials such as wood ty production during the year. Of this, about ducts industry and the wide existence of di- fuels, salvaged wood, tall oil and peat. Quanti- 1 TWh of wood fuels was used for the pro- strict heating systems. This means that, of ties are difficult to estimate, but have increased duction of electricity in CHP plants. Of the the European countries, it is Sweden and in recent years, and were estimated in 1997 remainder, 1.1 TWh of wood fuels were used Finland that have the highest proportions of as amounting to about 7-9 TWh. Imports in in industrial back-pressure plants and 1.2 biofuels in their respective energy systems. that year accounted for about 35-40 % of the TWh in the form of black liquors. Other bio- Other countries with potentially high volu- supply of biofuels for district heating plants, fuels, such as agricultural waste, landfill gas, mes of biofuels, but in which little use is and nowadays constitute an important source digester gas and peat were sometimes used made of them in their energy systems, are of such fuels. They are imported at prices for electricity production, although such use Germany, France, the UK, Romania and which are below those on the home market, was very limited. Austria. which means that they exert a certain price In a global perspective, biofuels are the press on indigenous fuels. For some indivi- An international context most important fuels for most of the third dual heating plants, imported fuels can form Seen in a European perspective, Sweden world’s populations. s a substantial part of their fuel supply. The acquits itself well in terms of its high pro- supply of biofuels is good, and there is a sig- portion of biofuels, making up about 15 %, nificant potential for their use in Sweden. For in its energy supply. It is very difficult to this reason, the trade in biomass fuels could find fully comparable details of biofuel use become increasingly important in future. in other countries, but there are factors that

The detached house sector Over 12 TWh of biofuels, peat etc., mainly Tw)1 Figure 1 la Use of biofuels, ped etc. in district heating 1980-1999 in the form of logs and chips, were used in 30 detached houses for heating in 1999. Wood-firing is commonest among property- owners with good access to forests, e.g. in agricultural or rural areas. The use of processed biofuels (pellets and briquettes) is still relatively modest in this sector, amounting to about 0.5 TWh in 1999. District Heating and District Cooling

District heating is often defined as a public where they are supplying apartment buil- Total energy supply in 1999 was 50.1 heating system for the production and supp- dings and commercial premises. High capi- TWh, of which biofuels accounted for 26.5 ly of heat in the form of hot water to most tal costs for the mains network mean that it TWh, or somewhat over 50 % of the total buildings under contractual arrangements is difficult for systems to achieve viability energy carriers’ input. between the supplier and user. It is produ- in low-density detached house areas, where The use of electricity in the sector, with ced in, and supplied from, hot water boiler the ratio of mains length to kWh of heat supp- most of it being accounted for by electric plants and/or combined heat and power sta- lied increases. Today, although about 40 % boilers and heat pumps, has halved since tions (CHP), the latter producing heat and of the total heating requirement for residen- 1990. Most of this reduction has been in the electricity simultaneously. There are also tial buildings and commercial premises in use of electric boilers, with the electrical heating systems which supply heat to, for Sweden is met by district heating, only about energy input to heat pumps remaining rela- example, only a limited residential area, and 6 % of the detached house heating load is tively constant. This reduction is due prima- these are known as group heating systems. met in this way. rily to the fact that tax exemption for inter- They are generally smaller than district hea- At present, the country has about 11 200 ruptible supplies to electric boilers was wit- ting systems. km of district heating mains. 42.9 TWh of hdrawn in 1991, and that the previous spe- Local authorities began to look at district district heating were supplied in 1999. Of cial contracts were terminated in connection heating in the 1940s. Its use spread during the this, over 60 % was used for residential spa- with restructuring of the electricity market. 1950s and 1960s as a result of the extensive ce heating, almost 30 % for heating com- Taxation on electric boilers during the win- investments in new housing and other buil- mercial premises and 10 % by industry. ter was increased in 1998. dings that were being made during that peri- The fuels mix in district heating plants District heating losses have fallen since od, in conjunction with a substantial need for has changed considerably over the last 20 the 1980s. Today, distribution and conver- modernisation or replacement of boilers in the years. In 1980, over 90 % of the fuel input sion losses account for about 15 % of the country’s existing building stock. Group hea- for district heating and CHP plants was in total supply of district heating: during the ting systems expanded, and were gradually the form of oil. Nowadays, the fuel mix is 1980s, when the prime energy input was in linked up into larger systems, with a particu- more varied, with biofuels being the main the form of oil, losses were about 20 %.Until larly substantial expansion of district heating energy source. The change to other energy the beginning of the 1980s, most district over the period from 1975 to 1985. sources can be partly explained by changes heating systems were operated as local aut- Energy policy has favoured district hea- in the carbon dioxide tax, which reduced the hority services. However, during the 1980s ting through various forms of state support, use of fossil fuels. Another reason has been and 1990s, most have been restructured as e.g. grants for the extension of the existing the good availability of electricity for seve- limited companies owned by local authori- district heating systems and the connection ral years, favouring the use of heat pumps ties. Today, there are about 220 companies of group heating systems and even indivi- and electric boilers. supplying heat in Sweden: of them, about dual buildings to existing systems. Repla- cing a multitude of small individual boilers by district heating enables the heat to be TWh Figure 12a .Use of disfrici Wing 1970-1999 60 supplied from a much smaller number of larger boilers with high efficiency, reducing both fuel requirements and emissions. To- day, investment support is available for biofuel-based combined heat and power production. The 1997 energy policy programme introduced grants for investment in district heating systems. However, take-up was poor, due to the fact that the costs for conversion were too high, and in 1999, the Go- vernment withdrew the grants. A decision on their possible restoration is expected in December 2000. District heating is most competitive in areas of high building density, which means that most systems tend to be found in areas District Heating and District Cooling

170 are members of the Swedish District No. of subscribers Figure 13 District cooling supplied 1992-1999 GWll Heating Association, an organisation that a00 $400 represents its members’ interests. 68 % of the companies are owned by local authorities, 20 % are privately owned, 8 % are owned by the State and 6 % are operated as local authority services.

District cooling District cooling is used primarily in offices and commercial premises, as well as for cooling of certain industrial processes. Its principle is similar to that of district heating: cold water is produced in a larger central plant and distributed through pipes to customers. The country’s first district cooling system was started up in Vaster& in 1992. In 1995, Stockholm Energi started to supply district cooling to central Stockholm, taking the cooling from sea water in Lilla VSirtan in combination with the evaporators of its district heating heat pumps. The market for Wh Figure 14a Energy supplied to district heating 1970-1999 district cooling has expanded strongly since 60 ...... its introduction, powered by such factors as ...... Natural gas incl. LPG ...... new building regulations, the greater use of computers, more awareness of the importance of good working conditions, expansion of the distribution system and the entry of new suppliers to the market. In 1999, there were 19 producers of district cooling, supplying a nominal load of 262 MW through 85 km of mains and supplying about 0.3 TWh (281 GWh) of district cooling. It is expected that, within 5-10 years, deliveries will have risen to about 0.5 TW. R

lWn Figure 14b Energy supplied to district heating by energy source 40 Oil Natural ws incl. LPG Gal, including blast furnance gas Biofuels, peat etc. The Oil Market

In recent years, the international oil market Figure 15 Swedish imports of crude oil and petrokum products, has experienced major price swings. From Mton 1972-1999 by country of origin (million tonnes, net) the record-low levels of 1998, average pri- no ces rose by 50 % during 1999 to amount to US$18 per barrel. Seen over a 20-year perspective, the 1999 prices were more or less normal. What is noticeable is the fact that, after having fallen substantially in 1998, oil prices have risen just as much during 1999 and 2000, now to over US$30 per barrel. The price rise started at the beginning of 1999, when the major OPEC oil-producing countries agreed to reduce output in order to raise the low world market price. The price rose rapidly, so that it is today more than 200 % higher than it was before the production cutbacks started. However, this massi- ve rise cannot be explained solely by the fact that the OPEC countries reduced output. During 1999, demand exceeded supply by about 0.9 million barreldday. During the Note: Sweden has been a net exporter of refined oil products since 1987 three fiist quarters of 2000, on the other hand, the situation was more or less reversed, as Million m Figure 16a Swedish use of oil products 1970-1999 the OPEC countries had again increased their 40 output. Today, production is at a higher level than in 1998: in other words, there is no shortage of oil. Nevertheless prices have continued to rise. One explanation for this is that the market is still jittery, wondering whether the OPEC countries will maintain their high production and how big the stocks of oil in the USA and Asia are. Another important factor in explaining price changes on the oil market is that there are many psyc- hological factors involved: expectations of a cold winter, as there has been a run of mild winters in recent years, is an example. Ho- wever, futures prices of oil were lower than spot prices at the beginning of October 2000, The Oil Market

which indicates that the market is expecting Figure 17 Spot (nominal) and future price reductions. This also creates Do or/mrieI real prices of light crude, 1970-1999 signals to reduce stocks in expectation of A0 lower prices.

Oil production Production methods for crude oil have become more efficient. Advanced computer methods have made it simpler to prospect for oil and to bring oil wells on line. New technology has also made it possible to ex- tract more oil from each well. The overall effect has been to reduce the cost of recove- ring the oil, and thus to improve the potential for lower future prices. However, this price reduction potential cannot operate as long as output is restricted. Between 1990 and 1999, world oil pro- 70 75 80 85 90 95 99 duction increased by 12 %, amounting to 74 million barrels per day. OPEC’s member states account for about 40 % of the world’s oil and during the year was 74.8 million barrels process, it also means that much of the vi- production, and 77 % of its reserves, which per day, and this value is expected to increa- able conversion from oil to other forms of thus gives them a considerable hold over the se in 2000. However, the increase in dem- energy carriers has already been made. oil market. Other major oil producers are and in 2000 has hitherto been less than the Sweden’s import trade in oil products is Norway, Mexico, Russia and Egypt. Having increase in output. The quantity available has approximately twice as large as the country’s failed in 1998 to reach agreement on pro- therefore exceeded demand during the three actual use of the products. 40 % of Sweden’s duction cutbacks in order to push up prices, first quarters, and is expected to continue to total input of oil products comes from Nor- OPEC did succeed in March 1999 in agree- do so for the rest of the year. way, which also supplies about 60 % of the ing to reduce the agreed production quota Future total demand for oil will depend country’s crude oil imports. Sweden’s signi- by 1.7 million barrels per day, relative to largely on world economic developments. In ficant import of oil is due to the fact that much earlier agreements. In addition, a number of this respect, Asia is the region that is most of the oil is processed in the country and then non-OPEC oil-producing countries under- difficult to assess in terms of demand, due re-exported. The export proportion has risen took to reduce their production by 0.4 milli- to the rapid economic growth in certain from 25 % of Sweden’s production of oil pro- on barrels per day. Today, the OPEC states countries. ducts in 1986 to 50 % in 1999. s have reached agreement on raising their output by 3.2 million barrels per day. The latest Swedish use of oil agreement on increased output was on 10” As with all other countries, Sweden is af- September, providing for an increase of 800 fected by the high world market prices of 000 barrels per day. It is expected that the oil. However, as Swedish energy policy sin- overall production figure for 2000 will ex- ce the oil crises of the 1970s has been to re- ceed that for 1999 by 2.6 million barrels per duce the country’s oil consumption, use of day. Much of this increase will come from oil has declined by 50 % since 1970. It is, in the OPEC countries, partly because Iraq has particular, the use of oil for heating that has increased its output as it has got its produc- fallen: oil has been replaced by electricity tion facilities working again. Total produc- and district heating, although the expansion tion from the OPEC countries now exceeds of nuclear power production and the natural the 1998 levels. gas distribution network have also played their parts. Total Swedish use of oil in 1999 The demand for oil amounted to somewhat over 16.3 million m3, In 1999, the economic situation in Asia im- of which about 65 % was used for transport. proved, resulting in the demand for oil ap- Although the low level of oil use in Sweden proaching normal levels again. Total dem- makes the country less sensitive to high oil The Coal Market

Since the middle of the 1980s, the coal indu- nes - can be recovered. If production conti- siderably, particularly during the 1990s when stry has been suffering from surplus capacity, nues at the present rate, proven and econo- the carbon dioxide and sulphur taxes were which has resulted in a fall in the price of coal. mically recoverable reserves would last for introduced. Plants that supply only heat have In 1998, for example, the price fell from US$ more than 200 years. The largest accessible abandoned coal almost entirely as a fuel due 46 per tonne to US$32 per tonne in Northern reserves of black coal are in Russia, the to the high taxes. CHP plants, however, still Europe, in step with falling oil prices. Prices Ukraine, China and the USA, while the lar- use some coal, as coal used for electricity rose again in 1999, initially as a result of ri- gest reserves of brown coal are in Russia, production is exempt from the carbon diox- sing oil prices, but then fell again to a final the USA, Eastern Europe and Australia. ide tax. The use of coal for electricity pro- average price of US$28.8 per tonne. duction is closely linked with hydro power Coal is still a competitive fuel in many Sweden’s coal supply production. During years with high hydro po- countries, due to the low costs of mining it. Coal played an important part in Sweden’s wer production, less coal is used for electri- However, it is heavily taxed in Sweden be- energy supply up to the 1950s, when it lost city production. During extremely dry years, cause of its severe environmental impact, ground to the cheaper and more easily hand- such as 1996, the use of coal for electricity which has reduced its competitiveness. Se- led oil. The oil crises of the 1970s,with their production can be more than double the nor- veral European countries, such as Germany, steep rises in the price of oil, contributed to mal amount. are now planning to close their coal-fired coal again becoming an interesting alterna- power stations and replace them with less tive fuel for reasons of price and security of The use of coal in industry polluting forms of power generation. Den- supply. The increasingly stringent environ- Industry uses energy coal, coking coal, coke mark, too, is attempting to reduce its use of mental standards imposed on coal-firing, and smaller quantities of other coal products coal. Work on attempting to implement the together with rising taxation for heat produc- such as graphite and pitch. The use of ener- carbon dioxide reductions in the Kyoto Pro- tion in particular, have meant that the use of gy coal has fallen during the 1990s, as a re- tocol, and the wish of many industrialised coal has stagnated, to the benefit of oil and sult of the change primarily to oil and biofu- countries to reduce their climate gas emis- biofuels, during the 1990s. els, which was partly caused by the intro- sions, are resulting in declining use of coal duction of the carbon dioxide tax in 1993. in these countries. However, coal is still a District heating and CHP production However, the cutback in industry has not competitive alternative in developing About 50 % of the coal is used in the district been as great as in the district heating sec- countries. heating sector, and the rest in industry. The tor, due to the fact that the carbon dioxide The largest producers of coal are China use of coal for district heating has fallen con- tax is lower on industry. a and the USA, which together account for over 50 % of world production. The four major exporting countries are Australia, South Africa, the USA and Indonesia, together accounting for over half of world trade in coal. Coal production in Europe is still 1 OOO ionner Figure 180 Swedish use of energy coal 1985-1999 falling, with the result that imports from oth- 3000 er continents are increasing. About half of all the coal that is mined is used as fuel, which means that it accounts for almost one-third of the world’s energy supply. Black coal is a relatively high-value coal, while brown coal has a lower calorific value. Coal is divided traditionally into two categories: coking or metallurgical coal, which is suitable for use in the iron and steel industry, and steam coal, which is sometimes also referred to as energy coal. Estima- tes put the amount of black coal and brown coal in the earth’s crust at about 11 000 billion tonnes, although only a small fraction of this - somewhat over 1000 billion ton- The Energy Gas Market

Natural gas Sweden’s interest in natural gas was awake- ned by the oil crises of the 1970s. Its use then gradually increased since its introduction to Sweden in 1985, but then stabilised at the present level in 1992. However, interest in natural gas as an alternative, primarily to oil and coal, has reawakened as a result of the restructuring of the Swedish energy system. The gas comes from the Tyra field in the Danish sector of the North Sea. After trans- iting Denmark, a pipeline under Oresund brings the gas ashore at Klagshamn outside Malmo. A 300 km trunk main extends from Trelleborg in the south to Gothenburg. Vat- tenfall Naturgas AB is responsible for operation of the existing trunk main and for and in agriculture. As LPG and oil and also, marily in local bus fleets and for urban dist- importation of the gas to southern and wes- to some extent, biofuels are interchangeable ribution vehicles. tern Sweden. Sydgas AB is responsible for fuels in these applications, the use of LPG is the distribution system in southern Sweden. sensitive to changes in energy taxation or fuel Gasworks gas Today, natural gas meets about 20-25 % of prices. Nevertheless, for certain industrial Gasworks gas is produced by cracking naph- energy requirements in most of the areas to processes, such as where cleanliness of the tha. SE Gas AB in Stockholm is the only which it is supplied, or about 1.5 % of the fuel and/or accurate temperature control are producer of such gas in the country. The gas- country’s total energy needs. important, LPG has qualitative advantages works gas used in Malmo and Gothenburg In 1999, imports of natural gas amoun- over other industrial fuels. During 1999,0.45 nowadays consists of natural gas mixed with ted to 854 million m3, equivalent to about TWh of LPG were used in industry and 0.04 a small proportion of air. Gasworks gas is 8.3 TWh’. It is supplied to about 25 towns TWh in district heating. used for heating detached houses, larger pro- and 55 000 consumers, made up of a large LPG is a petroleum product, consisting perties and industries, as well as for cooking number of industries, CHP and heating plants of the hydrocarbons propane, propene or in restaurants and homes. 0.51 TWh of gas- and about 8000-10 000 private customers. butane, or mixtures thereof. It is usually sto- works gas were used in 1999. A small amount of gas is also used as motor red in liquid form in rock caverns at low tem- fuel and as fuel for heating greenhouses. Gas perature. Distribution is by rail tank car, road Hydrogen has primarily replaced oil in industry, CHP tanker or by direct pipelines. Its environme- Pure hydrogen does not occur naturally, but plants and heating plants, with industry ac- ntal characteristics are very similar to those must be produced from sources such as me- counting for 41 % and CHPheating accoun- of natural gas, with a very low sulphur con- thanol, LPG, natural gas or by electrolysis ting for 39 % of Swedish natural gas content and a complete absence of heavy me- of water. Production of hydrogen is an sumption in 1999. tals. energy-intensive process: to produce hydro- Natural gas is a combustible mixture of gen with an energy content equivalent to 100 gaseous hydrocarbons, consisting mainly of Biogas kWh requires about 125 kWh of electricity. methane, and - unlike oil and coal - is al- Biogas consists of methane, formed by the The remainder is converted into heat. Re- most completely free of sulphur and heavy breakdown of organic materials such as se- search is in progress, with the aim of impro- metals. Combustion also produces no solid wage sludge, refuse or industrial waste un- ving production technology and developing residues such as ash or soot. As the gas con- der anaerobic (oxygen-free) conditions. The effective means of storage. When hydrogen tains hydrogen as well as carbon, the quantity process, known as digestion, occurs spon- technology has been sufficiently developed, of carbon dioxide produced by combustion taneously in nature, e.g. in marshes. Today, it will be possible to use the existing natural is 25 % less that that produced by release of Sweden has about a hundred biogas plants gas network for transport of hydrogen. Hy- the same amount of thermal energy from oil, in operation, most of them in sewage treat- drogen can also be used as a fuel in fuel cells, or 40 % less than from corresponding com- ment plants and landfill sites, producing dig- where it is converted to electricity and heat. bustion of coal. ester gas and landfill gas respectively. Most Sweden produces about 135 000 tonnes biogas is used either for local or district hea- of hydrogen per year. AkzoNobel operates LPG ting, or for electricity production. In 1998, four of the five largest industrial plants that Imports of LPG to Sweden in 1999 amoun- 27 GWh were used for electricity produc- produce surplus hydrogen. The gas is used ted to 708 000 tonnes, while 193 000 tonnes tion and 298 GWh for heat production. Bio- internally to produce hydrogen peroxide, were exported. 403 000 tonnes were supp- gas can also be cleaned and distributed via which is used for bleaching. lied to the Swedish energy system, equiva- the natural gas network as ‘green natural lent to 5.2 TWh, which was 36 % less than gas’. It is also used for powering vehicles: Natural gas internationally in the previous year. LPG is used mainly in interest in the gas for this application has In Sweden, natural gas is a marginal energy industry, as well as in the restaurant trade increased in recent years. Biogas is used pri- source. In the Nordic countries as a whole,

’ Since the fourth quarter of 1998, and in accordance with international practice, Statistics Sweden has used a revised value for the effective calorific value of natural gas, of 9.12 MWhllOOO m3, instead of 10.8 MWW1000 m3, The Energy Gas Market it meets about 11 % of primary energy supply. In the world as a whole, this proportion rises to about 20 %, while about 22 % of energy supplied in the European Union are met by it. The world’s natural gas reserves are substantial: in 1999, commercially viable reserves amounted to 146 000 billion m3, which would last for over 62 years at the present rate of use, with present technologies and present prices. The reserves are concentra- ted in the former Soviet Union (39 %) and in the Middle East (34 %). The world proportion of total energy supply met by gas has grown rapidly over the last decade, so that it is nowadays the fastest growing primary energy source in the world. Natural gas is included in the European Union’s strategy for creating a single energy market. Over the last couple of decades, national natural gas systems have been expanded and linked, to form an extensive European natural gas network. February 1998 saw the issue of the EU’s Natural Gas Market Directive, with the aim of increasing competition on the European natural gas market. The directive was due to have been incorporated in national legislation of EU member states by August 2000. In practice, however, restructuring of the natural gas markets in Europe will proceed at different rates. The directive is due to be implemen- ted in three stages, with at least 20 % of the market being open to competition in 2000. It is the largest users of gas, i.e. the electricity generation sector and industry, that will have been increasingly based on production estimated to account for between 38 and be given access to the deregulated market from the North Sea and imports from Rus- 68 % of system capacity. first. sia and Algeria. The North Transgas project, which was The EU sees a role for natural gas in its In order to increase the security of supply, carried out jointly by Finnish Fortum and by work of reducing environmentally hazardous there is European interest in increasing the Gazprom, looked at three routes for building emissions, primarily by replacing coal and number of links between the Russian and a gas pipeline from Finland to Germany. One oil and through the opportunities for efficient Norwegian natural gas fields and the conti- of the alternatives involved routing the pipe energy production. The proportion of total nent. Several studies have investigated the via Sweden. However, in 1999, the decision natural gas consumption accounted for by commercial feasibility of creating a Nordic was taken to route the pipe under the Baltic. the electricity sector is thus expected to in- natural gas network, and whether natural gas Nordleden is a project that has been car- crease substantially over the next ten years. can assist the reduction of greenhouse gases. ried out by Chalmers University of Techno- Total use of natural gas, too, is also expec- The Nordic Gas Grid (NGG) project was logy. One of its results indicated that it ted to increase considerably, although with carried out on behalf of seven energy utili- should be possible to reduce the cost of re- falling proportions for use in industry, hou- ties, with funding assistance from the EU ducing emissions of greenhouse gases in the sing and other sectors. Transeuropean Energy Networks (TEN) Nordic countries by SEK 5-25 000 million Only 3.4 % of the earth’s natural gas re- funds. It showed that there was sufficient by building a trans-Nordic natural gas pipe. serves lie within the EU, even if this is also market potential for a Nordic natural gas Further cost reductions could be effected if taken to include Norwegian natural gas. At network to be economically viable. Fully a Nordic natural gas pipe could be combi- the present rate of use, this would last for built out, NGG would be able to supply the ned with cooperation in other areas, e.g. gre- only 15 years. However, with rising dem- Nordic countries and the Baltic countries ater coordination of the use of electricity and and, dependence upon imported supplies will with their needs of natural gas and, in parti- district heating. s increase substantially, rising from the pre- cular, be able to transport large volumes of sent 28 % to 70 % in 2020’. Over the last natural gas to EU markets. With this system decade, natural gas supplies to the EU states in full operation, the transit volumes were Eurogas, ‘Natural gas in Western Europe’, 2000 Residential, Commercial, Service Sector etc.

In 1999, energy use in this sector amounted building during the 1990s has been very low, ses, which can be expressed in the form of to 151.2 TWh, or almost 40 % of the country’s amounting on average to 14 300 dwelling mean annual eficiencies. These efficiencies total final energy use. This amount was 2.3 units per year. This can partly explain why indicate how great a proportion of the ther- TWh less than that of the previous year. energy use in the sector has not increased in mal energy content of the energy carrier is About 86 % of the energy use in this sec- recent years. On the other hand, the floor actually utilised by the consumers in the form tor is for space heating, domestic hot water areas of commercial premises have increased of thermal energy. They allow for the ag- production and the powering of domestic substantially since 1970, thus also affecting gregated effects of the combustion efficien- appliances. Energy used in land use appli- the demand for heating, domestic hot water cy of the heating system, heat losses, distri- cations accounts for about 5 % of total ener- and electricity for building services systems. bution losses and shortcomings in control gy use in the sector, holiday homes account Figures 22a and 22b show the growth of and adjustment of the heating system. The for another 2 % and other service applica- temperature-corrected electricity use, clas- mean annual efficiencies of electric heating tions account for 7 %. These latter applica- sified by application. Use of electricity has and district heating are, on average, higher tions consist of energy use in the building grown uninterruptedly from 1970 until the than those for oil, which means that repla- sector, street lighting, waterworks, sewage middle of the 1990s, but has since stabilised cing oil by electric heating or district hea- treatment plants and electricity works. at about 70 TWh. ting results in an overall reduction in final Over 60 % of the energy use in the sector energy use. is used for space heating and domestic hot Lower final energy use The number of heat pumps in use has in- water production. As this is affected by tem- Several factors have helped to offset increased considerably in recent years, contri- perature conditions, there can be considera- creased energy use in the sector. On the hea- buting to a reduction in the actual use of en- ble random variations in energy demand ting front, there has been a change from oil ergy for space heating and domestic hot from one year to another. To enable proper to other energy carriers. In detached houses, water production. Heat pumps abstract heat comparisons to be made, it is necessary to the change has been mainly to the use of elec- from rock, earth, air or water and supply it correct for climatic conditions. 1999 was tric heating, while in apartment buildings it to the building’s heating system. Those ab- almost 10 % warmer than a statistically av- has been to district heating. Both these chan- stracting heat from rock, the ground or lake erage year, which means that the amount of ges have resulted in a reduction in total final water can supply 80-90 % of the annual spa- energy used for space heating was lower than energy use through reduced conversion los- ce heating and domestic hot water require- normal. After applying such correction, en- ses in the end use processes. Different ener- ments of a detached house, with the remain- ergy use in the sector in 1999 amounted to gy carriers exhibit differences in distribution ing 10-20 % usually being supplied by elec- 157.3 TWh; a reduction of 0.2 % relative to and conversion losses in the process of final tric immersion heaters or an oil-fired boiler. 1998. conversion to heat at the consumers’ premi-

Reduced use of oil Figures 21a and 21b show that the total Figure 2la Final energy use within the temperature-corrected use of energy has Wh residentiol, commercial, service sector etc. 1970-1999 remained relatively stable between 1970 and ...... 200 ...... Total use, temperature-corrected ...... 1999, although the relative proportions bet- ...... \ ...... ween the different energy carriers have changed. Oil crises, rising energy prices, changes in energy taxation and investment pro- grammes have all affected the move from oil to other energy carriers. In 1999, total use of fossil fuels in the sector amounted to 30.6 TWh, as against 113 TWh in 1970. Much of this reduction is due to a shift from the use of oil for heating to electricity and district heating. The number of dwelling units (single-family houses and apartment buildings) in the country increased by about 30 % between 1970 and 1999. However, the rate of new

wh Figure 21b Fino1 energy use within the residential, commercial, service sector etc. by categories of energy carrier

Oil products Electricity District heating Biouels, patetc. Residential, Commercial, Service Sector etc.

Heat pumps normally supply 2-3 times as oil alone, while 7 %have district heating and worn-out appliances are replaced by new, much thermal energy as they use in the form 4 % are heated by wood. more efficient ones. This has applied parti- of electrical energy for powering them. This District heating is the commonest form cularly to white goods. ‘free’ heat is not included in the approxima- of heating in apartment buildings, with ap- tely 151 TWh of energy used by the sector proximately 73 % of apartments being supp- Electricity for common purposes in 1999. lied by it, equivalent to a use of almost 22 The use of electricity for common purposes Other factors that have helped to prevent TWh of district heating. Oil is used as the has increased substantially, from 8.2 TWh in an increase in energy use for space heating sole or main heat source for 13 % of apart- 1970 to 26.1 TWh in 1999. The reasons for and domestic hot water production in resi- ments, equivalent to 5 TWh of oil. The use this development include rapid growth in the dential buildings and commercial premises of electric heating in apartment buildings is service sector and greater use of office mach- are various types of energy conservation relatively low, amounting to 2 TWh in 1998. ines. The high growth rate of private and pu- measures, such as retrofitting additional ther- The main source of heat in offices, com- blic services has also resulted in a relatively mal insulation and upgrading of windows in mercial premises and public buildings, too, substantial increase in the total floor area of older buildings. is district heating, with over 50 % of such offices and commercial premises. buildings being supplied, equivalent to 15 Lighting and ventilation, which at the Heating TWh of district heating. Electric heating of beginning of the 1990s accounted for 70 % Of the 97 TWh that were used for space hea- commercial premises amounted to 5 TWh, of the use of electricity for common purpo- ting and domestic hot water production in which was also the amount of space heating ses, have become more efficient as a result 1998, it is estimated that about 45 % were and domestic hot water production energy of new and improved light sources, more used in detached houses, 29 % in apartment supplied by oil. sophisticated operational control and correct buildings and 26 % in commercial premises sizing of systems at the time of installation. and public buildings. Electricity for household purposes Nevertheless, the potential for further impro- The most common form of heating in The use of electricity for household purpo- vements in the efficiency of electricity use detached houses is electric heating, being the ses more than doubled between 1970 and in offices and commercial premises is still main heating source in about 40 % of such 1999, from 9.2 TWh to 19.7 TWh, due to an regarded as considerable. Although compa- dwellings. Approximately 26 % of detach- increase in the number of households and nies constantly replace equipment, which ed houses have direct-acting electric heating, greater ownership of domestic appliances. becomes steadily more efficient, there is also with the remaining 14 % having waterborne However, continued improvement in the a trend towards greater numbers and higher electric heating. The reason for this high pro- electrical efficiency of such appliances has powers of items and equipment. a portion of electric heating is that it is cheap tended to offset this increase, as old, to install and simple to run. Another common heating system in de- Figure 22a Electricity use in the residential, commercial, tached houses is electricity in combination Wh service sector dc. 1970-1999, corrected for climate variations with wood and/or oil firing. The proportion EO of detached houses with such systems increased steadily until 1997, so that almost 30 % of detached houses have such heating systems as their main heating source. In 1998, however, this proportion fell slightly. The total use of electricity for heating in detached houses amounted to 20.5 TWh in 1998. In detached houses with electric heating in combination with some other energy carrier, e.g. oil or wood, the electric heating can easily be replaced by the other energy carrier. This means that such house heating systems are relatively flexible, with the use of electricity being determined by the relative prices of the various energy carriers. About 8 % of detached houses are heated by Industry

In 1999, industry used 0.3 TWh more energy fall of 5 % in energy use. Electricity use in factors as technical development and struc- than during 1998, amounting to 151.2 TWh, the sector also fell, but by 6 %, i.e. by more tural changes within the sector. or 38 % of the country’s final energy use. than the fall in total energy use, as the reces- Classified by energy source/carrier, this sion tended to hit the electricity-intensive Changes in oil and electricity use consisted of 20.9 TWh of petroleum products, sectors harder than other industrial sectors. Despite rising industrial output, the use of 14.8 TWh of coal and coke and 54.2 TWh of 1993 saw an increase in industrial out- oil has fallen substantially since 1970, re- electricity. Use of natural gas amounted to 3.8 put, which was followed by substantial rises sulting from the greater use of electricity and TWh, and that of district heating to 5.3 TWh. in 1994 and 1995. Output volume in 1999 improvements in the efficiency of energy Supplies of biofuels, peat etc. amounted to was over 50 % higher than in 1992, while use. This trend started in connection with the 52.2 TWh. Of this, over 40 TWh was used in energy use increased by almost 12 %. During oil crises of the 1970s, with the ensuing in- the pulp and paper industry, made up in turn the same period, the use of electricity intensive work by both State and business ai- mostly of black liquors. Final energy use in creased by almost 4 TWh, or nearly 8 %. med at reducing the use of oil. In 1970, use industry therefore consisted of 26 % of fossil When comparing the time period from of electricity constituted only 21 % of energy and 35 % of biofuels, peat etc., with 1975-1997 with that from 1990-1997, it can industry’s total energy use, which can be the remainder consisting of electricity and be seen that the response relationship bet- compared with the present proportion of 36 district heating. ween energy use and increased industrial %. At the same time, the use of oil has fallen In Sweden, a relatively small number of output has fallen by about 40 %, due to such from 48 % to 14 % in terms of industry’s sectors accounts for the bulk of energy use in industry. The pulp and paper industry uses about 46 %, the iron and steel industry about 14 % and the chemical industry about 7 %. Together, these three energy-intensive sectors account for two-thirds of total energy use in Wn Figure 2347 Final energy use in industry 1970-1994 industry. The engineering industry, although 200 not regarded as energy-intensive, nevertheless accounts for almost 8 % of total energy use in industry as a result of its high proportion of total industrial output in Sweden.

The relationship between output and energy use In the short term, energy use in industry essentially follows variations in industrial output. In the longer term, total energy use is also affected by such factors as changes in the types of goods produced, technical development, taxes and energy prices. Between 1990 and 1992, industrial output fell by 6 %, which was reflected by a Industry energy use. Between 1970 and 1999, the pro- Figure 24a Specific use of oil in industry portion of biofuels, peat etc. has increased ItWh/SEl( of proddctwn VCI .e 1970-1999,1991 price levds from somewhat over 21 % to almost 35 % of 06 total industrial energy use. The change from oil to electricity has meant that primary energy use in the sector has fallen, partly because electrical energy often has a higher efficien- Pulp and paper industry cy than oil for the majority of applications, and partly because the conversion losses as- ..... sociated with electricity production are now ....Ironandsteel industry...... booked to the electricity production sector...... Industry total Between 1992 and 1999, the use of oil products has increased by 3.5 TWh, or 20 %. Among the factors contributing to this increase have been higher output, lower energy and carbon dioxide taxes and greater use of oil as a replacement for interruptible electric boilers.

Changes in specific energy use Specific energy use, i.e. the amount of ener- Figure 24b Specific use of electricity in industry gy used per monetary unit of output value, kWn/SEK of pcduction valie 1970-1 999, 1991 price levels provides a measure of how efficiently the 04 energy is being used. Since 1970, specific energy use in industry has fallen continuous- ly. Between 1970 and 1999 it fell by 45 %, showing a clear trend towards less energy- intensive products and production processes, together with changes in the types of industries and products. During this period, industrial output increased by 80 %. The change from oil to other energy carriers, particularly electricity, is reflected in the specific use of oil and electricity per unit of output value. Specific use of oil fell by 80 % between 1970 and 1992, while specific use of electricity increased by 27 %. The upturn in the economy over the last few years, coupled with changes in industry's energy taxation structure, is reflected in changes in specific energy use, which continues to fall. Between 1992 and 1999, it fell by 26 %, with specific use of oil falling by 21 % and specific use of electricity falling by 29 %. The recent substantial fall in 1 .'. 198.5.. 1911 specific electricity use has been the result ...... q.'1 primarily of a major increase in the output ...... 1980(83) 1975 (85) 1973 (83) ...... 1'.._...... of the engineering industry, coupled with ...... _,_..I' ...... almost unchanged electricity use. For several reasons, we can expect a continued fall in specific energy use. Investiga- tions are at present in progress, for example, into the feasibility of further reducing carbon dioxide emissions by industry through 10KK 171 long-term agreements. Put simply, these ...... :::::::::j:u::: I IJJ (CJL 1 , , , , , , , , , Figures in brackets are ...... agreements mean that industry undertakes ...... the industrial output index, ...... to improve its efficiency of energy use and/ ...... 1990=100 Use of oil, Wh or to replace the use of fossil fuels, in ex- 0 10 20 30 40 50 60 70 80 change for, for example, a lessening of taxation or a promise of unchanged taxation in future. I Transport

Energy use for domestic (internal) transport Environmental impact standards. Directive 1999/94/EU, introduced in 1999 amounted to 91 TWh, or 23 % of All forms of transport give rise to emissions in December 1999, requires clear statements the country's total final domestic energy use. that are detrimental to the environment and of vehicle fuel consumptions and emissions International marine bunkers used 17 TWh to health. Although the introduction of cata- in connection with the sales of new passen- of bunker oils. lysers has substantially reduced the emissi- ger cars. The energy carrier for the transport sec- on of several hazardous substances, carbon tor consists almost entirely of oil products, dioxide emissions cannot be reduced in this Technical development primarily petrol and diesel fuel. In 1999, the way, which means that they have continued Technology advances both through impro- use of these two fuels made up 83 % of the to increase in step with greater use of fossil vements to existing technology and in the country's energy use for domestic transport. fuels. form of completely new technology. Of the In recent years, the use of petrol has decli- It has been found difficult to reach agre- latter, those that are closest to a commercial ned, while that of diesel fuel and aviation ement on harmonised fuel taxes within the breakthrough within the next ten years are fuel has increased. Use is largely dependent EU. However, the European automotive in- hybrid-fuelled vehicles, ethanol-fuelled on general economic conditions, although dustry has entered into a voluntary agree- vehicles and flexible fuel vehicles (FFV). technical development also has a considera- ment with the European Commission to re- Hybrid vehicles have two alternative drive ble effect on usage patterns. The two main duce carbon dioxide emissions from new systems, e.g. both an electric motor and a guide measures intended to reduce the use passenger cars by 25 % by 2008, relative to combustion engine. FFVs are capable of of energy by the transport sector are energy the 1995 levels. Corresponding agreements using different fuels simultaneously, e.g. et- tax and carbon dioxide tax. have also been reached during the year with hanol and petrol. Several of the large vehic- Japanese and Korean vehicle manufacturers. le manufacturers have already launched pas- Alternative motor fuels In addition, the EU has decided to introduce senger cars with alternative drive systems, The use of alternative motor fuels, such as more stringent requirements in respect of or will do so in the next few years. Howe- ethanol and biogas, is at present marginal: the emissions from diesel engines in heavy ver, looking ahead further than ten years, the costs of producing most of these fuels today vehicles, known as EURO standards. The automotive industry is pinning considerable are higher than the corresponding costs for present level of standards are known as hopes on fuel cell technology. Fuel cells, petrol and diesel fuel. However, this cost dif- EURO-11, but discussions are in progress powered by hydrogen and oxygen, produce ferential is being eroded by technical deve- concerning the introduction of EURO-I11 electricity from two electrodes on each side lopments and the introduction of environme- standards, which would reduce health-ha- of an electrolyte. s ntal levies. A considerable amount of research zardous emissions to 70 % of the EURO-I1 is being carried out, e.g. within the fields of production technology and vehicle technology. A plant for the production of ethanol, for example, is being built in Norrkoping, for an expected output of 50 000 m3/year. lWh Figure 26a Final energy use in the transport sector 1970-1999 125

Modes of transport Domestic passenger and goods transport in 1998 amounted to 110 billion passenger-km and 60 billion tonne-km respectively. Private cars provide 73 % of passenger transport: bus travel provides 8 %, rail travel provides 4 % and air travel provides somewhat over 4 %. 54 % of internal freight haulage is by road, 32 % by rail and 14 % by water. In recent years, freight haulage by road has increased at the expense of rail and water transport.

Final energy in the transport sector, energy curriers TWh Figure 26b use by '' Petrol Diesel/Gas oil Electricity Bunker oil Energy Supply in the European Union

The foundation of the present European Energy supply today to 2020 expects the consumption of natural Union was laid shortly after the Second and a look towards 2020 gas to increase by almost 50 %by 2010, af- World War, when six Western European Oil is the dominating energy source in EU ter which it is expected to stabilise. The main countries (Belgium, Germany, France, Ita- energy supply, and its use - particularly in reason is a continued increase in the use of ly, Luxembourg and Holland) cooperated in the transport sector - is continuing to rise, natural gas for electricity production. The use control and management of the coal and ste- so that it nowadays supplies about 45 % of of renewable energy sources has been rela- el industries. The next step was the Treaty final energy use. On the other hand, the use tively stable since 1985, although there has of Rome, which laid the basis for economic of coal has fallen considerably, to less than been an upturn in recent years. The use of cooperation between the countries. In 1991, half of its 1985 level, so that it nowadays wind power is expected to increase substan- the Maastricht Treaty established the struc- supplies only 5 % of final energy use. The tially by 2020. ture that is called the European Union, and greatest reduction has occurred in Germa- which rests on three pillars: the single mar- ny, although its use has also declined con- Self-sufficiency and ket, the agricultural and environmental po- siderably in the UK. The use of natural gas dependence on imports licy and the common foreign and security continues to rise: since 1985, it has increased As a region, the EU is the world’s largest policy, in conjunction with cooperation in by 34 %, so that it nowadays accounts for importer of energy. Despite increased pro- legal and internal matters. The EU today 23 % of final energy use. The European duction, self-sufficiency in energy supply consists of 15 member states. Commission forecast for developments up has fallen, as the demand for energy is in-

Sweden takes over the presidency On lstJanuary 2001, Sweden will take over the presidency of the European Union for the first time. The main duty of the presidency, which rotates among the EU states moe Figure 27 Total final energy use in the 1985, 1990 and 1997 every six months, is to direct EU coopera- * EU, io00 tion and to further common points of interest. Sweden will be taking over the presidency from France and handing over at the end of its period to Belgium.

A significant portion of world energy consumption The European Union is one of the largest energy-consuming regions in the world: approximately 30 % of total OECD energy consumption, and about 15 % of world energy consumption, is accounted for by it. However, in recent decades, energy consumption in the EU has been rising more slowly than in the rest of the world.

0 IO0 200 300 400 Energy Supply in the European Union creasing even more rapidly. From having Enlargement of the European Union all the candidate countries have started mem- been 60 % self-sufficient in energy supply The EU is in the process of preparing for a bership negotiations, with a first group of in 1985, the EU was only 54 % self-sufficient new enlargement, this time towards Central countries -Cyprus, Hungary, Poland, Esto- in 1997. It had, in other words to import 46 and Eastern Europe, where a total of ten nia, the Czech Republic and Slovenia - ha- % of its energy requirements. Forecasts in- countries from the former Eastern European ving precedence. These negotiations take dicate that EU production of oil, gas and coal states -Bulgaria, the Czech Republic, Esto- several years, and each country is judged on will all decline by 2020. The Commission's nia, Hungary, Latvia, Lithuania, Poland, Ro- its own circumstances. Figure 29 shows en- forecasts expect dependence on imports to mania, Slovakia and Slovenia - are candi- ergy use by different forms of energy carr- have risen to about 65 % by 2020. dates for membership. In addition, Cyprus, ers for the priority applicant countries and Malta and Turkey have also applied for for the other applicant countries. a Fifteen states with different conditions membership. With the exception of Turkey, The EU consists of 15 member states with differing conditions. GNF's vary widely, with Germany, France, Italy and the UK having the highest values. On the other hand, countries such as Portugal, Greece and Ire- land have GNF's that are only 5-10 % of those of the large states. The climates also differ considerably, which has a considerable effect on energy requirements. Together Figure 29 Total final energy use in central and eastern European states Germany, France, Italy and the UK account Mioe applying for EU membership, 1996 for almost 70 % of total energy use, although this proportion changes somewhat when converted to per-capita energy use. As Sweden and Finland have a relatively high proportion of energy-intensive industries, together with a cold climate, they have relatively high per-capita energy use. Belgium and Holland, too, have high per-capita energy use values. On the other hand, per-capita use is lower in the Mediterranean countries of Greece, Ita- ly, Portugal and Spain.

I Of these countries, Poland accounts for over half of total final energy use. Except Cyprus, Malta and Turkey. World Energy Resources and Energy Use

Globally, world energy supply is dominated in the former Eastern bloc countries have to the industrialised countries have largely by fossil fuels, which account for about 80 fallen dramatically during the first half of been maintained. % of total energy supply. Oil is the most the 1990s, although the situation is now star- important energy source, meeting somewhat ting to stabilise. Price controls in the former Energy use over 40 % of demand, followed by coal at Soviet Union have been removed, with the Since 1990, total world energy use has risen over 20 % and natural gas at almost 20 %. result that domestic prices of crude oil, ligh- less rapidly than it did during the 1980s, Historical development from 1970 until to- ter products and natural gas have almost when the average rate of increase was 2 % day shows that, in relative terms, it is the reached world market price levels. Exports per annum. The average rate of increase use of gas that has increased more than that of either of the other fossil fuels. The use of coal continued to rise until 1990, but has sub- sequently stabilised. Hydro and nuclear power account for about 2 % and 6 % of world energy supply respectively. According to the energy statistics prepared by EA- the In- ternational Energy Agency - over 10 % of world energy supply is met by biofuels. Much of the world’s energy requirements are still met by individual supplies of wood and other forms of biomass. This use is not included in the international statistics. One assessment is that, outside the OECD countries and the former Soviet Union, traditional energy sources such as wood, char- coal etc. are probably the world’s largest individual energy source. Figure 32 * Total energy use per inhabitant, 1997 Resources and reserves I Word Proven resources of fossil fuels - primarily I oil, coal and natural gas - are estimates of the quantities that can be viably extracted with present economic and technical conditions. Expressed in relation to present rates of consumption, they amounted at the end of 1999 to: 230 years’ production of coal 41 years’ production of oil 62 years’ production of natural gas.

The proven resources consist of the known, discovered and developed fractions of the earth’s total resources. They can be ‘increased’ by prospecting, or by rising prices ‘ USA, Canada, Mexico, Noiway, Switzerland, Iceland, Australia, Japan, New Zealand and Turkey. making new and more expensive methods The Organisation of Independent States. Consists of twelve states, of which Russia and Ukraine are the largest. For of recovery viable. statistical reasons, the Baltic states have been included.

Mbe Figure 33 Total world commercial energy use 1965-1999 Energy supplies and international trade I oooo Non-OECD countries hold a significant part of world energy supplies and reserves, and have been able to export their surpluses - primarily of oil - to the industrialised countries. The industrialised countries import almost half of their oil requirements but, as a group, are almost self-sufficient in coal and gas. It is expected that their import requirements for oil will increase over the next 15 years. Production of oil in North Ameri- ca has been relatively stable over the last couple of decades, although consumption has increased significantly. In Europe, dependence upon imported oil supplies has fallen due to substantial increases in North Seapro- duction. Both production and use of energy World Energy Resources and Energy Use during the 1990s was 0.9 %. Total energy use remained relatively constant during 1998 and 1999. A comparison between regions shows that energy use in the developing countries continues to rise steadily, due primarily to population growth, urbanisation and industrialisation. Energy use in the former Soviet Union fell dramatically during the first half of the 1990s, but has now sta- bilked. Within the European Union, energy use increased slightly during the 1990s. North America and Japan have shown higher increases. World energy use varies considerably from one area to another. The differences are large: the OECD countries, for example, use 4-5 times as much energy per capita as is used in Africa, Asia or Latin America. In the group of ‘other OECD countries’, which includes the USA, no less than nine times as much energy is used per capita as is used in Africa. China, India, South Korea and Latin Ameri- rope and the former Soviet Union between Table 1 shows the energy intensity, i.e. ca, in which areas consumption is expected 2010 and 2020 as a result of the closure of the amount of energy used per unit of GNP to double. Other forecasts of world energy old reactors without replacing them with new produced, for a number of groups of use expect the same magnitude of increase ones. World use of hydro power and other countries, and thus gives an idea of the of world energy consumption, of over 2 % renewable energy is expected to grow at al- amount of energy used in relation to econo- per year.’ most 2 % per year. mic production. The forecasts differ for certain regions, Expressed in economic terms, over three and this is particularly noticeable for Eas- Forecasts for emissions times as much energy is used per production tern Europe and the former Soviet Union. of carbon dioxide unit in the central and eastern parts of Euro- Nevertheless, according to DOE/EIA con- The Kyoto Protocol, which has been formu- pe, in the former Soviet Union and in Asia, as sumption in this region in 2020 is expected lated as part of the work of international cli- is used in the OECD states. To some extent, to be somewhat less than the 1990 level. mate negotiations, contains undertakings for the differences can be explained by the fact Consumption in Western Europe is ex- the countries in Annex 1 (the industrialised that the areas are at different stages of deve- pected to increase by almost 1 % per annum countries, together with the former Soviet lopment. Asia, however, has shown a sharply until 2020. In the case of North America, Union and the countries in Eastern Europe) reduced energy intensity during the 1990s. the expected increase is 1.2 % per annum, to reduce their emissions of greenhouse ga- The countries in Eastern and Central Europe, while that for Japan and Australia is 0.9 %. ses by 2008-2012. (Read more in the sec- too, have improved their efficiency of energy Oil is still the world’s major fuel. The rate tion entitled ‘Energy and the Environment’.) use. Energy intensity in the world as a whole of increase of use is expected to be some- According to the calculations in the DOE/ has declined by a little less than 1 % per an- what higher than during the last few deca- EIA forecast, the industrial countries will num over the last couple of decades. des: in particular, it is the transport sector need to reduce their carbon dioxide emis- Energy use in the former Soviet Union is that will continue to increase. The use of oil sions by 24 % in relation to those given in highly inefficient. After the break-up of the in the developing countries is increasing in the forecast if they are to fulfil their Kyoto Soviet Union, the economies are in a state parallel with their rapidly increasing level Protocol undertakings, which call for a re- of flux and problems are enormous. In eco- of energy use. Natural gas is the fuel of which duction of 7 % by 2010. However, the fore- nomic terms, this is reflected by greater use use is expected to grow the most rapidly, cast calculations paint a completely different of energy per unit of production during the largely due to greater use for electricity pro- picture for the former Soviet Union and the 1990s. However, the fact that energy prices duction in the industrialised countries. The Eastern European countries, which can in- today are now more or less up to world mar- use of coal is expected to decline significant- crease their emissions of carbon dioxide by ket prices should bring about improvements ly in Western Europe, as well as in Eastern almost 40 % in relation to the forecast valu- in the efficiency of energy use. It is assu- Europe and the former Soviet Union. Ho- es for 2010. Under the terms of the Kyoto med that improvements in efficiency will wever, reduced use in these areas will be Protocol, this group of countries may not continue in China, Eastern Asia and Latin more than offset by greater use in the deve- increase their carbon dioxide emissions by America. loping countries, and particularly in China more than 2 % by 2010. In total, according and India. Together, these two countries ac- to the forecast, the countries in Annex 1 must Forecasts count for over 90 % of the expected increa- reduce their carbon dioxide emissions by According to the most recent forecast’ from se in the use of coal during the period. The 12 % in relation to the forecast results for US Department of Energymnergy Informa- use of nuclear power is expected to decline 2010 in order to fulfil their Kyoto Protocol tion Administration (DOEEIA), world en- in the industrialised countries, Eastern Eu- undertakings. F2 ergy demand is expected to continue to rise ’ International Energy Outlook 2000, www.eia.doe.gov. steadily. Much of this increase will occur in IEA international Energy Agency, ‘World Energy Outlook 2000’. Platt’s ‘World Energy Service: World Outlook the developing countries, and particularly in 1999’ from Standmd & Poor, and Petroleum Economics Ltd. and Petroleum Indushy Research Associates, PIRA. Taxes and Prices

he use of energy has been taxed Greenfax reform Types of tax in Sweden since the 1950s. The It was decided in the spring of 2000 that about Energy tax is levied on most fuels, and is objectives have varied over the SEK 30 billlion of taxation revenue should independent of their energy content. Carbon years: originally, the objective was to finan- be transferred over a ten-year period. During dioxide tax, which was introduced in 1991, ce the State’s public spending requirements, 2001, this will involve about SEK 3.3 billion is levied on the amount of carbon dioxide but in later years the emphasis changed to the in higher energy tax, which will be balanced emitted by all fuels except biofuels and peat. need to control the production and use of en- by reduced tax on work. It will be raised from 37 ore/kg to 53 ore@ ergy in order to achieve various energy and Sweden’s carbon dioxide emissions are to with effect from 1st January 2001. A sulphur environmental policy objectives. The envi- be cut in accordance with the country’s com- tax was introduced in 1991, and is charged ronmental element of energy taxation was mitments under the Kyoto Protocol. Carbon at the rate of SEK 30 per kg of sulphur emis- given greater importance at the beginning of dioxide tax will be increased by 40 % from sion on coal and peat, and at SEK 27/m3 for the 1990s, and the green line continues in 1st January 2001, which will be partly balan- each tenth of a percent by weight of sulphur the budget for 2001. ced by a reduction of 8 % in the energy tax. in oil. An environmental levy on the emis- There are different taxes on electricity, This will have the effect of increasing the en- sion of NO, was introduced in 1992, at the energy, carbon dioxide, sulphur and NOx, vironmental pressure of the taxes when users rate of SEK 40/kg of NO, emissions from and they can vary, depending on whether the are choosing between fossil fuels. boilers, gas turbines and stationary combus- fuel is being used for heating or as a motor Higher carbon dioxide taxes mean that tion plant that supplies at least 25 GWh per fuel, whether electricity is being used in electricity will become cheaper in relation annum However, it is intended to be neutral northern Sweden or the rest of Sweden, to other forms of energy carriers, and so the relative to the national budget, and is repaid whether it is being used by domestic consu- tax on electricity will be raised by 1.8 ore/ to operators of plant in proportion to their mers, industry or the energy sector, and so kWh. Within the framework of green taxre- energy production and in inverse proportion on. In 1999, revenues from energy and en- form, higher energy taxes will be offset by a to their NOx emissions, so that only those vironmental spot taxes raised over SEK 52 higher tax-free allowance and reduced with the highest emissions are net payers. billion or about 2.6 % of GNP. employer’s levy. Taxes and Prices

The electricity tax varies, depending on receives an environmental subsidy equal to gy tax, and pay only 35 % of the carbon di- where, and for what, the electricity is used. a rebate of the electricity tax. There is also oxide tax. This means that, in principle, en- at present special support for small-scale ergy and carbon dioxide taxes on industry Electricity and heat production power production, amounting to 9 orekWh. are the same as in 2000. There are special Fuels that are used for electricity production Fuels used for heat production pay ener- rules that rebate tax that exceeds 0.8 of the are exempt from energy and carbon dioxide gy tax, carbon dioxide tax and, in certain sales value of the products manufactured. tax, although they are subject to the NO, levy cases, sulphur tax, as well as the NO, levy. There are various transport tax levels, de- and sulphur tax in certain cases. Since 1st In principle, biofuels and peat are tax-free pending on the environmental class of the July 2000 are nuclear power plants taxed on for all users, although the use of peat att- fuel, and their effect has been to concentrate the basis of their gross thermal power out- racts the sulphur tax. Special rules apply for use on the least environmentally detrimen- put from the reactors. Under a particular set simultaneous production of heat and electri- tal classes. Petrol tax has not been raised of defined operating conditions, this tax rai- city (CHP). The fuel used for production of for 2001, apart from the increase due to in- ses the same revenue as the earlier tax rate the electricity can receive a full rebate of en- dexing: the tax on diesel fuel, however, has of 2.7 orekWh. In addition, there is a levy ergy and carbon dioxide tax. The fuel used been increased by 11.7 ore per litre. This has of 0.15 orekWh for decontamination and de- for the net beneficial heat pays only half the been offset by a reduction in the rate of commissioning of the country’s previous nu- normal energy tax rate. value-added tax payable by public transport clear facilities at the Studsvik research cen- operators from 12 % to 6 %. tre, and a further levy that amounts to about Taxation at the point of use The sales tax on private cars was remo- 1 orekWh for financing future storage faci- Domestic users pay different rates of elec- ved in 1996, with the aim of encouraging lities for spent nuclear fuel. tricity tax, depending on whether they live the sales of new vehicles and thus reducing Investment grants are available for the in the north of the country or the rest of the the average age of the vehicles in use. The building of wind power plants, biobased country. Manufacturing industry, horticul- average age of the Swedish vehicle fleet is CHP plant and small-scale hydro power ture and - since 1st July 2000 - agriculture, relatively high, and older vehicles usually plants. In addition, wind power production forestry and fisheries are exempt from ener- produce more exhaust pollution. E?

Note. The tables supplement to Energy in Sweden includes the Retail Wice Index for 1970-1999, which means that the actual prices can be converted to equivalent prices.

ore/ kWh Figure 34 Current energy prices in Sweden inclusive taxes’ 1970-1 999

’ A table defining the various environmental classes is included in the tables appendix Energy in Sweden: facts and figures. Energy and Environment

he production and use of energy Regional environmental problems and the atmosphere could absorb and dilute are major sources of harm to the Regional environmental problems include all our emissions to levels so low that they human and natural environment. acidification of the ground and water, and would not be noticed. Nowadays, we know Examples range from the ecological effects eutrophication. Problems of these types are that some of the emissions that we generate of the construction of hydro power schemes, generally more difficult to identify than lo- result in global environmental problems. through oil spills from tankers to vehicle ex- cal environmental problems, as the damage This is clearly exemplified by the increase haust emissions. Although Sweden has ta- that they cause becomes apparent only after in greenhouse effect due to the emission of ken significant steps to counter these mecha- a longer time, akin to the fatigue of metals. greenhouse gases and by destruction of the nisms, by such means as the imposition of The emissions are spread over greater dis- ozone layer. The extent of global environ- statutory regulations, taxation and encoura- tances, and it can be difficult to locate the mental problems is such that they afflict the gement of the development of low-pollution source(s). Environmental problems are re- entire globe. They are therefore also the most technology, much still remains to be done. garded as being regional if they afflict large difficult to tackle, as they require internatio- The negative effects on the environment areas, countries or, in certain cases, conti- nal coordination. can be classified into three levels: local, re- nents. gional, or global. Acidification The boundaries between these levels are Global environmental problems Since the beginning of the 1970s, acidifica- fluid, being determined not only by the type “The solution to pollution is dissolution” tion has been one of the environmental pro- of emission, but also by how far it spreads. was still regarded as a truth at the beginning blems in Scandinavia to which the most at- Emissions of dust and soot, for example, are of the 1960s. It was thought that the oceans tention has been paid. As the ability of the nearly always regarded as local problems, although the material can very well be spread over an area the size of Lapland. Figure 35a Emissions of sulphur dioxide (Sa2)in Sweden 1980-1998 1000 ionnes/year Local environmental problems 600 Examples of local environmental problems include the fallout of dust from power stations or industrial processes, vehicle ex- hausts, smog, discharges of lead and the emission of carcinogenic substances. As problems of this type generally have an immediate effect on their surroundings and are easy to detect, it is natural that steps to deal with them can generally be taken at an early stage. Local environmental problems are regarded as being those that are restricted to the most immediate environment, such as that of the area of a medium-sized Swedish town and its surroundings.

loo0 ionnes/yeor Figure 35b Emissions of sulphur dioxide (so,) in Sweden, by emission sources

350 Road traffic ofher transport Combustion of oil and gas Combustion of coal and coke Energy and Environment ground and water to neutralise acidity is less air pollution to its neighbouring countries, sulphur protocol was produced by the UN in these countries than in most other parts of primarily Russia, Finland, Norway, Poland Economic Commission for Europe (ECE) in Europe, it was the Scandinavian countries in and the Baltic states, although much of the 1994. Under the terms of the protocol, seve- which the problem was first detected, with the pollution is precipitated in the sea. Swedish ral European countries have undertaken to result that it was long regarded as an essenti- emissions come primarily from industrial reduce their SO, emissions by between 30 ally Scandinavian problem. One of the effects processes, the combustion of oil and gas and % and 80 % by-2010, relative to the 1980 of acidification is the precipitation of metals from transport. levels. The protocol came into force on 5” in the ground and water, with the commonest August 1998, and is legally binding, as it has example being aluminium. This results in the Reducing sulphur emissions been ratified by a sufficient number of sta- death of forests and to the disappearance of Emissions in both Sweden and the rest of tes. Within the EU, the European Commis- many sensitive species of plants and animals, Europe have fallen considerably since 1980. sion has succeeded in setting an emissions both on land and in the water. Sweden’s Parliament has committed the limit for the three key pollutants of sulphur The main source of this acidification is country to reducing its sulphur emissions to dioxide, nitrogen dioxide and ammonia. the emission of sulphur in the form of sulphur only 20 % of the 1980 levels by 2000. This These limits have been set such that the dif- dioxide. The sulphur dioxide is oxidised in reduction was, in fact, achieved in 1993, ference between the actual emission levels the atmosphere to sulphuric acid, which is partly as a result of less use of oil and partly and the critical load limits, i.e. what the en- then brought down to the surface of the earth as a result of lower sulphur contents in the vironment can stand, will be reduced by 50 in precipitation, and thus referred to as ‘wet oil. An important step in the work of redu- % for each country. deposition’. Sulphur emissions can also be cing emissions was taken when a new deposited directly in the form of sulphur dioxide, known as ‘dry deposition’. As the conversion process of sulphur dioxide in the Figure 36a 9 Emissions of oxides of nitrogen atmosphere for wet deposition takes a few loo0 ronnedyear (expressed CIS NO2)in Sweden 1980-1 998 days - sometimes up to a week - it means 500 that precipitation over Sweden originates primarily from sources in other countries. In 1980, over 17 % of sulphur precipitation in Sweden originated from domestic sources. By 1998, this figure had been reduced to somewhat over 7 %. As the prevailing winds over Sweden are westerly, the country is exposed to depressions and fronts from the west and north-west: large quantities of air pollutants are also carried over Sweden by southerly winds powered by high pressures over the continent. The countries from which about 34 % of today’s precipitation in Swe- den comes are primarily Germany, Poland and the UK. However, Sweden also exports Energy and Environment

In addition to sulphur dioxide, ammonia and nitrogen dioxide (reduced and oxidised nitrogen respectively) also contribute to acidification. However, due to the role of nitrogen as a macronutrient (i.e. an important nutrient that occurs in a relatively high concentration in biomass), these emissions make less contribution to acidification than does sulphur, although they make a considerable contribution instead to another major problem, eutrophication.

Eutrophication Eutrophication, particularly of lakes and the sea, is largely due to immission of nitrogen. However, in the Gulf of Bothnia, it is not nitrogen that is the main cause of eutrophication but phosphorus. However, as phosphorus emissions are not due to the use of energy, they will not be discussed further here. Nor, in fact, does the greater portion of nitrogen emissions originate from energy use, but rather from agriculture, although the contribution from the energy sector is sufficiently large to be significant. Eutrophication is primarily a problem in water ecosystems. Forest eutrophication is rare, although forests in south-west Sweden do show signs of nitrogen saturation. It is only when nitrogen levels are saturated that nitrogen contributes to acidification. Eu- trophication of water ecosystems results in excessive growth of water plants, resulting in cloudiness of the water and reduced depth Mtonnes Figure 38a Emissions of carbon dioxide (Cod in Sweden 1980, 1987-1998 of visibility. In the longer term, there is a 109 risk of lakes becoming totally clogged by plant growth and turning into marshland. Eutrophication also contributes to oxygen- free bottom environments through the increased demand for oxygen to break down dead plant growth. Oxygen-free bottom zo- nes are a problem in a number of areas, including the Baltic. In fact, the Baltic is per- haps the biotope that has suffered most from nitrogen precipitation, resulting in algae blooms and oxygen-free bottoms. These oxygen-free bottoms make it difficult for fish to reproduce, and also contribute to a seri- ous depletion of bottom fauna.

service sector etc. Energy and Environment

Catalytic exhaust cleaning The most important anthropogenic gre- has reduced emissions enhouse gas is carbon dioxide. Other gases Although emissions of nitrogen have not that contribute to the effect include water been reduced as much as emissions of vapour, methane, nitrous oxide (laughing gas sulphur, there has been an increase in the rate - N1O) and ground-level ozone. These ga- of reduction in recent years, due primarily to ses actually have a more powerful greenhou- the introduction of catalytic exhaust cleaning se effect but, due to their low concentrations on vehicles. By far the greatest proportion of in the atmosphere, they represent less of a the emissions comes from road traffic, alt- problem than does carbon dioxide. The fol- hough it is also here that the greatest reduc- lowing text therefore concentrates primar- tions have been achieved. About 17 70of NOx ly on carbon dioxide emissions. precipitation in Sweden originates from do- The OECD countries emit over half of mestic sources. The largest contributors to the total global carbon dioxide emissions, NOx precipitation from other countries are with the USA being responsible in turn for Germany, the UK and Denmark. by far the greatest amount, of over 45 %. Other countries with high emissions include The greenhouse effect Japan, the UK and Germany. In terms of Strictly, the greenhouse effect is not an en- highest specific emissions per inhabitant, we vironmental problem: it is, in fact, an essen- find the USA in top place, equal with Lux- tial factor for the existence for life on earth. Without carbon dioxide and water vapour in the atmosphere, the average temperature of Figure 39a * Emissions of sulphur dioxides (SO2)in Europe 1980-1998 the earth would be about 33 OClower than it Mronnesfyear is today (Le. about -18 "C),and the planet 60 would be frozen. It is, however, the increase in the greenhouse effect, resulting from 35 the emission of greenhouse gases, that pre- sents an environmental problem. Over the last 150 years, anthropogenic activities have increased the concentration of carbon dioxide in the atmosphere by about 30 %: if the oceans were not also a major sink for carbon dioxide, this increase would have been closer to 60 %. The average temperature of the earth has risen by about 0.5 OC during the 20" century, accelerating particularly during the last 25 years.

I West Germany until 1989. The part included in EMEPs calculations. Energy and Environment embourg, but with Australia and Canada fol- ement was reached on a document regula- Emission trading involves the trading of lowing after. These countries also have re- ting emissions of carbon dioxide and five emission rights. Countries that have emitted latively high emissions in relation to their other greenhouse gases. The document sets less than their permitted proportion can sell GNF’s, although the old Eastern European out reductions for all Annex 1 countries, i.e. their remaining portion to another country countries such as Poland and the Czech Re- the OECD countries and the previous Eas- that wants to emit more. Joint implementa- public have even higher values. tern European states, for implementation by tion involves effecting some improvement Sweden contributes a few parts per thou- 2010. The reductions are expressed as an in another country and being credited with sand to the world’s carbon dioxide emis- average over the period 2008-2012, and are the resulting reduction in emission. A third sions, with specific emissions per inhabitant referred to the 1990 emission levels. The EU, mechanism is that of clean development, being below the average for both the OECD which negotiated as a single group, is requi- which involves essentially the same as joint countries and for the EU. Carbon dioxide red to reduce its emissions by 8 %. A subse- implementation, except that the improve- emissions have fallen by about 30 % bet- quent agreement has been reached on the ments are carried out in a non-Annex 1 coun- ween 1980 and 1998, although they have ri- internal breakdown of this aggregate reduc- try. Much work remains to be done before sen somewhat during the 1990s. tion, under the terms of which Sweden is in these mechanisms have adopted their final fact permitted to increase its emissions by 4 form, and it is also necessary for at least 55 International climate cooperation %. ‘Flexible mechanisms’, in the form of states, accounting for at least 55 % of the An outline convention on climate changes emission trading and joint implementation, emissions from the Annex 1 countries, to was signed at the 1992 UN Conference on are included in the Kyoto protocol in order ratify the protocol. the Environment and Development (UN- to facilitate more cost-efficient reductions. CED) in Rio. It came into force in 1994, when it had been ratified by a sufficiently large number of countries. Sweden ratified Figure 40a Emissions of oxides of nitrogen the Convention in 1993, at which time it also Mtonnec/yeor (expressed as NO4 in Europe 1980-1998 adopted guidelines for Swedish climate po- 25 licy. One of the contents of the Convention is that all industrial countries should take steps to reduce their emissions of greenhouse gases and to increase the uptake and storage of the gases. The countries must also regularly submit details of their progress and the steps that they have taken to the UN. At the meeting of the parties in Berlin in 1995, it was noted that work to date was in- adequate, and a process was started to produce a legally binding document. At the third meeting of the parties in Kyoto in 1997, agre-

I West Geimany until 1989. The part included in EMEPs calculations. Energy and Environment

Eastward enlargement of he EU The prime idea of EU membership is to previous Eastern European states. The envi- Environmentally, Western Europe is regar- create better conditions for economic growth. ronmental effects of an eastwards enlarge- ded as being far ahead of Eastern Europe The rapid rate of development in countries ment do not depend only on EU requirements with the latter's out-of-date industries, such as Estonia and Poland in recent years is and regulations. EU directives are often ex- coal-fired power stations and lax environ- likely to continue if they gain access to the pressed in terms of general objectives, and it mental legislation. The Eastern European single market and to investment support from is up to each individual state to decide on the energy sector is characterised by low ener- EU funds. On the other hand, the Western ways and means it will use to achieve them. gy efficiency, dangerous nuclear power sta- European dependency on road traffic will be However, it is clear that they must incorpo- tions and a high use of coal, and so there is extended eastwards, particularly bearing in rate EU regulations in their own legislation, enormous potential for improvement. As an mind the fact that most of the infrastructure which means that there will be a substantial example, it can be noted that the energy in- projects receiving EU support are concerned modernisation of such legislation. Neverthe- tensity of Estonia, measured in terms of to- with the building of roads. less, it will take time for the changes to work tal primary energy supply (TPES) in rela- In the longer term, eastwards enlargement through and have a real effect. In addition, tion to the country's GNP, was almost five of the EU should bring positive environme- application for membership by some times as high as that of the EU in 1997. The ntal benefits, although the positive effects are countries can represent a cutback in their pre- TPES energy intensity in Russia was almost not as certain in the short term. Higher stan- sent ambitions if they are intending to make ten times as high. An eastward enlargement dards of living and greater use of energy usu- the necessary changes at a later date with EU of the EU should therefore result in a clea- ally go together, and there is nothing to indi- assistance instead of carrying them out to- ner environment in the new member states. cate that this should not be the case in the day with their own funding. E? EU membership involves improved and more relevant legislation, coupled with re- Figure 41a 9 Emissions of carbon dioxide [COJ per inh bitant quirements for reduced emissions. At the and BNP 1998 in EU and QECD-countries I5 I ...:: I I same time, higher consumption associated ... Kg CO, per BNP Poland with higher standards of living can result in (1990 USD] greater environmental impact, higher energy use and more transport. The work of SGech Repubic bringing environmental legislation into line $3Australia and improving emissions and effluent treat- %Canada USA ment is proceeding only slowly. The slow @Luxembourg progress of the applicant countries (the Czech Republic, Poland, Hungary, Slovenia and Estonia in the first wave) in the environmental sector can delay their admission Tonnes CO, to the EU. per inhabitants 0 5 10 15 I 25

Figure 41 b Emissions of carbon dioxide (CO,) per inhabitant in EU and OECD-countrie 1998

EU ...... I

Tonnes CO, per inhabitant I 0 IO A Glossary of Energy Terms

Alternating current (AC) Conversion losses Electrical energy Electric current in which the direction of Energy loss in a conversion plant or process, Energy released or absorbed when electrons flow of the electrons is constantly reversing. resulting from the less than 100 % efficien- move through a solid, a liquid, a gas or a cy of the process. vacuum. Automotive petrol Petrol intended for use in spark ignition in- Cracking Energy ternal combustion engines. Chemical modification of heavy hydrocar- A measure of work performed in a given bons in petroleum to lighter hydrocarbons. time: the product of power and time. Ener- Biofuels gy is expressed in watt-hours (Wh). Fuels consisting of biomass. Crude oil Petroleum from oil wells that has not been Energy balance Biogas processed other than the possible removal 1 The balance of energy supplied and energy Gas produced from biomass as the raw ma- of dissolved gases and solids, and which is used. terial, e.g. by fermentation. in transport or being stored or is used as a 2 A presentation of energy supplied and ener- Biomass raw material. g Y Material of biological origin, and which has used. Degree of energy utilisation not been processed, or processed to only a The relationship between the amount of (elec- Energy carrier very limited extent. trical) energy actually produced and that which A substance, material or service used to car- Blast furnace gas is theoretically possible over a given period ry energy, e.g. water, air, electricity, battery Flammable gas consisting of a mixture of of time. cells, or fuels such as coal, crude oil, logs nitrogen, carbon monoxide and hydrogen, etc. Diesel engine produced by the reduction of iron ore in a Internal combustion engine of piston type, Rational use of energy blast furnace. in which the heat of compression is suffi- Making the best use of energy supplied to a Brown coal cient to ignite the combustible mixture of system. Combustible solid containing about 70- fuel and air. Energy conversion 75 % by weight of carbon. Brown coal can Diesel fuel A process that converts one form of energy be likened to compacted peat, and is at an A light oil for use in diesel engines. to another form. early stage in the conversion to coal. Digester gas, sludge gas Energy crops Carbon dioxide, CO, Flammable gas formed by anaerobic bacte- Crops grown for use as energy raw materi- Carbon dioxide, C02,is a gaseous oxide of rial action on biological material. als. carbon, formed by complete combustion of substances containing carbon, e.g. hydrocar- Digestion Energy forest bons. Controlled biodegradation of organic sub- Trees or bushes grown for use as energy raw stances under anaerobic conditions, by which materials. Chemical energy the substances are transformed without air Energy released or absorbed when the bonds change in water-filled pores and in which Energy saving between atoms or molecules are changed. evil-smelling are produced, such as hydrocar- Reduction in the use of energy by refraining from the use of services etc. Coal bons, ammonia, Combustible rock-like substance with a high hydrogen sulphide etc. Energy system content of carbon. Coal is an intermediate Direct current (DC) A system of plant, equipment etc. that meets stage in the geological conversion from Electric current of which the electron flow a need for energy, e.g. for a house, a factory brown coal to anthracite. is always in the same direction, e.g. from a or a town. Cold condensing power station battery. Energy use A power plant that produces only electrici- Direct electric heating Utilisation of electrical energy, heat or some ty, using a steam turbine cycle. Efficiency Electric heating that supplies heat to the heat- other form of energy. is 3545 %: the remainder of the thermal en- ed area without intervening heat storage or Ethanol ergy in the fuel is removed by the cooling heat carrier other than air. Ethyl alcohol, normally produced by fermen- water to the sea, lake, river or atmosphere. District heating tation of sugar or some other biomass. Coke The provision of a public heating supply, de- Exergy The solid residue from the pyrolysis of coal. livered by means of hot water in supply and That part of a quantity of energy in some return pipes. After supplying heat to a build- Coke oven gas particular form that can be completely ing’s own space heating and domestic hot Flammable gas produced by the coking of converted into work. The terms energy and water heating system, the cooled district heat- coal. exergy describe the suitability of a form of ing water is pumped back for reheating. energy for energy conversion. The less the Coking plant Efficiency proportion of exergy, the greater the amount Plant for the production of coke and the A measure of how efficiently a power sta- of energy that is lost as heat. cleaning of coke oven gas. tion or heating plant works. It indicates that Fossil fuel proportion of the energy in the fuel or input Combined heat and power plant Fuel formed from biological materials during that is converted to useful electricity and/or A power plant that produces both electricity and earlier geological periods, e.g. coal and petro- heat. heat, supplying the heat to a district heating sys- leum. tem. A Glossary of Energy Terms

Fuel Motor fuel Power balance A substance containing substances having Gaseous, liquid or solid fuel intended for 1. The balance of power input and output. chemically or otherwise bound energy that starting, running or heating a machine, a 2. A presentation of input and output power. can be utilised for conversion to heat or oth- vehicle engine etc. Power shortage er form of energy. Natural gas The state of an energy system, e.g. an elec- Fuel cell Flammable, non-volcanic gas found in po- tricity supply system, not having sufficient A cell for direct conversion of chemical en- rous rock strata, often together with and/or capacity immediately to supply the power ergy to electrical energy. partly dissolved in, petroleum. demand. Fuel oil Natural gas combination plant/cycle Pumped storage power station Combustible oil intended for oil burners, A combined gas turbinekteam turbine plant, Hydro power station which, when not produ- consisting of low or high viscosity or fuelled by natural gas. cing power from water falling through the tur- semi-solid mixture of hydrocarbons, produ- bine, can be used to pump water from a lo- Normal year ced from crude oil by distillation or crack- wer level to a higher level for later produc- To enable fair comparisons to be made being. tion of power from it. tween the use of electricity, heating etc. from Gasification one year to another, the climatic conditions Refining The conversion of solid materials, e.g. coal of the years concerned must fiist be convert- To clean or purify a raw material by wholly or peat, to a gaseous form, with or without ed to equivalent conditions of a statistically or partly removing pollutants or hazardous chemical change of the substances involved. average year. constituents. Gas turbine Nuclear energy Renewable energy source Power plant for the production of electric en- Energy released in nuclear reactions or by An energy source that can be renewed or re- ergy. A gas turbine consists of an air com- radioactive decay. placed at the same rate as it is used. pressor, combustion chambers and a power Nuclear power plant Sludge gas turbine driven by the exhaust gases. In turn, A power plant that utilises nuclear energy See: digester gas the power turbine drives the generator. for the production of electrical energy. Speed control Gasworks Oil equivalent Control of the speed of, say, a fan, in order A facility for the production gas by means The quantity of fuel oil that, in practical use, to control some other quantity, e.g. an air of gas generators. is regarded as providing the same quantity flow. Gasworks gas of energy as some quantity of other fuel. Statistically average year Gas of a medium calorific value, containing Paraffin (Am.: kerosene) A year for which the meteorological condi- methane, nitrogen, butane and (in low con- A clear, colourless and low viscosity liquid, tions are the average of those over a period centration) carbon monoxide, with the addi- consisting of hydrocarbons, produced by dis- of years. tion of a substance to provide a tracer smell. tillation with or without refining. Steam coal Geothermal heat Peat Coal that is used primarily for burning. Heat flowing from the interior of the earth Organic earth-like material formed in wet to the surface. Thermal power plant and oxygen-deficient conditions by the deg- A power station in which heat is converted Greenhouse efFect radation of dead plant and animal material to electricity. Accumulation of heat in the lower atmos- by bacterial and chemical action. phere through a reduction in cooling that is Tonne- kilometer Petrol (Am.: gasoline) caused by outward radiation from the earth Unit of transport work, calculated as the A clear, colourless and low viscosity liquid, to space, caused primarily by the ability of product of the aggregated distance in kilo- consisting of hydrocarbons, produced by dis- carbon dioxide to absorb thermal radiation. meter over which a number of tonnes have tillation of crude oil, by cracking of gaseous been carried and the number of tonnes. Heat pump or liquid petroleum fractions or by synthe- A device for raising the temperature of en- sis. Toe (tonnes of oil equivalent) ergy from a low-temperature source such as See Oil equivalent Petroleum product water, air, etc., to a higher temperature. To Gaseous, liquid or solid mixture of hydro- Useful energy do this, it requires a certain input of some carbons, produced from crude oil by distil- Energy used for its intended purpose within other form of energy, usually electricity. lation, cracking or some other process. a defined system. Hydro power plant Potential energy Waste heat A power station that converts the potential Energy released or absorbed by changing the Heat released from processes. energy of water to electrical energy. position of an object. Wind power plant Kinetic energy Power A power plant that converts wind energy into Energy released or absorbed as a result of The rate of doing work, given by the quo- electrical energy. the change in velocity of a moving object. tient of energy and time (= energy per unit Mechanical energy time) The sum of kinetic energy and potential energy that is not electrical energy. Units and Conversion factors

The international standard unit for measure- Units commonly used for comparison are ment of energy is the joule (J), although the the PJ, TWh and Mtoe. See the diagram on watt-hour (Wh) is often used in Sweden. One the right for conversions between them. joule is equal to one watt-second, which means that one watt-hour is equal to 3600 J. Practical terms International comparisons often use the ton- What are these various energy units, ex- ne of oil equivalent (toe),which represents pressed in practical terms? A rough guide is the energy obtained by burning one tonne of as follows: oil, i.e. 11.6 million Wh. 1 kWh can run a cooker hotplate for one When measuring larger quantities of en- hour. ergy, the joule, watt-hour and even toe are 1 MWh can power a private car for 1000 inconveniently small units. Instead, multi- km (= 621 miles). ples such as thousands or millions are used, 1 GWh represents the energy used by a indicated by the following abbreviations: medium-sized town in one day. k (kilo) lo3 thousand 1 TWh is the quantity of energy supplied M (mega) lo6 million by a large nuclear power plant in about G (giga) lo9 thousand million two months’ full-load operation. T (tera) 10” million million P (peta) lOI5 thousand million million

Elec frici fy for household purposes A modern, energy-efficient washing A family of four persons in a detached hou- machine should not use more than about 200 se uses about 5500 kWh per annum of elec- kWh/year, and a tumble dryer should not use tricity for household purposes. Average more than about 200 kWyear. Similarly, a breakdown of electricity for household pur- new, larger, energy-efficient refrigerator poses is as follows: should not use more than about 130 kWyear, and a new energy-efficient medium-sized Refrigerators and freezers 1 400 kWh chest freezer should not use more than about Food preparation 1 000 kWh 270 kWyear. Clothes care 1 000 kWh Lighting 900 kWh Dishwashing 500 kWh Other aooliances 700 kWh Total 5 500 kWh Energy Supply in Sweden 7 999 - an Overwiev

41 Swedish National Energy Administration The Swedish National Energy Administration was established on January 1, 1998, and is Sweden's national authority on issues regarding the supply and use of energy- The main task of the Administration is to implement the energy policy programme approved by the Riksdag in the spring of 1997. The aim of the programme is to establish an ecologically as well as economically sustainable energy system.

We work to promote a safe, efficient and environmentally sustainable supply and use of energy. We do so by supporting research on renewable energy sources and technology procurement of energy-efficient products and by providing investment support for the development of renewable energy.

The Administration also serves a supervising function as monitoring authority of the recently deregulated electricity market. The Department for Structural and Market Analysis provides analyses of the linkages between energy, the environment and economic growth.

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.-a Q 8 0 Swedish National 0 0 Energy Administration 00 \ 0 0 0 c'1 .o Swedish National Energy Administration Box 310 SE-631 04 Eskilstuna Sweden r-J Phone +46 16 544 20 00 Fax +46 16 544 20 99 www.stem.se +W