SuèdeA prepaFT 4/09/00 13:12 Page 1 INTERNATIONAL ENERGY AGENCY Energy Policies of IEA Countries Sweden 2000 Review INTERNATIONAL ENERGY AGENCY Energy Policies of IEA Countries Sweden 2000 Review INTERNATIONAL ENERGY AGENCY ORGANISATION FOR 9, rue de la Fédération, ECONOMIC CO-OPERATION 75739 Paris, cedex 15, France AND DEVELOPMENT The International Energy Agency (IEA) is an Pursuant to Article 1 of the Convention signed in autonomous body which was established in Paris on 14th December 1960, and which came into November 1974 within the framework of the force on 30th September 1961, the Organisation for Organisation for Economic Co-operation and Economic Co-operation and Development (OECD) Development (OECD) to implement an international shall promote policies designed: energy programme. • To achieve the highest sustainable economic growth and employment and a rising standard of It carries out a comprehensive programme of living in Member countries, while maintaining energy co-operation among twenty-four* of the financial stability, and thus to contribute to the OECD’s twenty-nine Member countries. The basic development of the world economy; aims of the IEA are: • To contribute to sound economic expansion in • To maintain and improve systems for coping Member as well as non-member countries in the with oil supply disruptions; process of economic development; and • To promote rational energy policies in a global • To contribute to the expansion of world trade on context through co-operative relations with non- a multilateral, non-discriminatory basis in member countries, industry and international accordance with international obligations. organisations; • To operate a permanent information system on The original Member countries of the OECD are the international oil market; Austria, Belgium, Canada, Denmark, France, • To improve the world’s energy supply and Germany, Greece, Iceland, Ireland, Italy, demand structure by developing alternative Luxembourg, the Netherlands, Norway, Portugal, energy sources and increasing the efficiency of Spain, Sweden, Switzerland, Turkey, the United energy use; Kingdom and the United States. The following • To assist in the integration of environmental countries became Members subsequently through and energy policies. accession at the dates indicated hereafter: Japan (28th April 1964), Finland (28th January 1969), * IEA Member countries: Australia, Austria, Australia (7th June 1971), New Zealand (29th May Belgium, Canada, Denmark, Finland, France, 1973), Mexico (18th May 1994), the Czech Germany, Greece, Hungary, Ireland, Italy, Japan, Republic (21st December 1995), Hungary (7th May Luxembourg, the Netherlands, New Zealand, 1996), Poland (22nd November 1996) and the Norway, Portugal, Spain, Sweden, Switzerland, Republic of Korea (12th December 1996). The Turkey, the United Kingdom, the United States. The Commission of the European Communities takes European Commission also takes part in the work of part in the work of the OECD (Article 13 of the the IEA. OECD Convention). © OECD/IEA, 2000 Applications for permission to reproduce or translate all or part of this publication should be made to: Head of Publications Service, OECD 2, rue André-Pascal, 75775 Paris cedex 16, France. TABLE OF CONTENTS 1 SUMMARY AND RECOMMENDATIONS ......................... 7 2 CONDUCT OF THE REVIEW .................................... 15 3 GENERAL ENERGY POLICY ..................................... 17 4 ENERGY AND THE ENVIRONMENT ............................. 31 5 ENERGY EFFICIENCY .......................................... 41 6 ELECTRICITY ................................................... 61 7 NUCLEAR AND RENEWABLES .................................. 87 8 OIL, GAS AND COAL .......................................... 97 9 ENERGY RESEARCH AND DEVELOPMENT ....................... 117 A ANNEX: ENERGY BALANCES AND KEY STATISTICAL DATA . 135 B ANNEX: INTERNATIONAL ENERGY AGENCY “SHARED GOALS” . 139 C ANNEX: GLOSSARY AND LIST OF ABBREVIATIONS ............... 141 3 Tables and Figures TABLES 1. Energy and Carbon Dioxide Taxes ................................. 33 2. Energy Taxes on Fuels Consumed by Manufacturing Industry . 34 3. Emissions Reductions Attributed to the Swedish Programme for an Environmentally Adapted Energy System in Eastern Europe ........ 34 4. Variations in Primary and Final Energy Intensities in Sweden . 41 5. Variations in Adjusted Final Energy Intensities ....................... 42 6. Unit Consumption and Specific Consumption of Cars in Sweden ...... 47 7. Energy Efficiency Indicators for Road Transport of Goods ............ 47 8. Environmental Targets for the Transport Sector ....................... 53 9. Consumption of Electricity, 1998 ................................... 61 10. Electricity Consumption and Generation, 1998 ...................... 63 11. Installed Capacity on 31 December 1998 .......................... 65 12. Imports and Exports, 1998 ........................................ 65 13. Main Generation Companies in the Nordic Region, including Denmark . 69 14. Main Distribution and Retail Supply Companies in Sweden, Norway and Finland ............................................. 71 15. Size of Distribution Companies .................................... 71 16. Operating Nuclear Power Reactors in Sweden ...................... 87 17. Hard Coal Imports, 1978-1998 ................................... 109 18. Target Areas for the Energy Research, Development and Demonstration Programme .................................... 118 FIGURES 1. Map of Sweden .................................................. 6 2. Ministry of Industry, Employment and Communications ............... 22 3. Energy Production, 1973-2010 .................................... 24 4. Primary Energy Supply, 1973-2010 ................................ 25 5. Total Final Consumption by Fuel, 1973-2010 ....................... 25 6. Final Consumption by Sector, 1973-2010 .......................... 26 7. Carbon Dioxide Emissions by Fuel and by Sector, 1975-1998 ........ 36 8. Emissions of Sulphur Dioxide in Sweden, 1980-1997 ................ 37 9. Emissions of Oxides of Nitrogen in Sweden, 1987-1997 ............. 37 10. Energy Intensity in Sweden and in Other Selected IEA Countries, 1973-2010 ..................................................... 42 11. Energy Intensity by Sector in Sweden and in Other Selected IEA Countries, 1973-2010 ........................................ 43 12. Total Final Consumption vs GDP in the Transport Sector in Purchasing Power Parities, 1960-1998 ........................................ 56 13. Electricity Consumption vs GDP in Purchasing Power Parities, 1960-1998 . 58 14. Electricity Consumption by Consumer Group, 1970-1998 ............ 62 15. Generation and Consumption of Electricity .......................... 63 16. Electricity Generation by Type of Power, 1973-1999 ................. 64 4 17. Exchanges of Electricity ........................................... 66 18. Swedish National Electricity Grid .................................. 68 19. Spot Prices in the Nord Pool, 1998: Sweden and System Price ....... 70 20. Breakdown of Ownership of Electricity Generating Capacity .......... 70 21. Industrial Electricity Prices in IEA Countries, 1998 ................... 73 22. Domestic Electricity Prices in IEA Countries, 1998 ................... 73 23. Spot Prices in the Nord Pool, 1996-2000: Sweden and System Price . 74 24. Average Transmission Fees for the Nordic Grid ..................... 74 25. Organisation of the Swedish Electricity Market ...................... 75 26. Nuclear Facilities in Sweden ....................................... 88 27. OECD Gasoline Prices and Taxes, 1st Quarter 2000 ................. 99 28. OECD Automotive Diesel Prices and Taxes, 1st Quarter 2000 ........ 100 29. Final Consumption of Oil by Sector, 1973-2010 .................... 101 30. Natural Gas Consumption, 1973-2010 ............................ 103 31. Natural Gas Network ............................................. 104 32. Coal Consumption by Sector, 1973-2010 ........................... 109 33. Annual Energy Research and Development Expenditures ............. 126 34. Energy Research and Development Expenditures by Category ........ 126 5 Figure 1 Map of Sweden Russia Kiruna Norwegian Luleå Sea Finland Storsjön SWEDEN Norway Gulf of Bothnia Siljan Helsinki Oslo Uppsala Aland Islands Tallinn Örebro Stockholm Estonia Vänern Baltic Vättern Skagerrak Göteborg Gotland Latvia North Riga Kattegat Öland Denmark Sea Km Sea Malmö Lithuania Copenhagen 0 100 200 6 1 SUMMARY AND RECOMMENDATIONS SUMMARY Sweden has in place strong, market-based policies in some areas of the energy sector. Market-oriented policies include: I The successful development of an international market in electricity. I Co-operation in the Baltic Sea region on energy, climate policy and wider trade issues. I Close consultation of government with industry, and a high level of industry awareness and voluntary activity. I Tax measures to encourage, but not micro-manage, the development of the energy sector in an economically efficient and environmentally sustainable way. Even so, the structure of the system could be improved. But there is a high level of government intervention in other areas. Energy policy in Sweden is influenced by several key decisions: I The decision to phase out nuclear power. I The commitment to reduce greenhouse gas emissions in line with the Kyoto Protocol. I Limits to the further development of hydro resources. I The aim to use renewables and