Nordic Energy in Europe
– a way forward
Clean, Competitive and Connected
Nordic Action Group on Climate and Energy
European Climate Foundation
24 September 2013
Nordic Action Group
on Climate and Energy
Hördur Arnarson CEO, Landsvirkjun, Iceland
Carl Bennet Chairman, Getinge, Sweden
Ingrid Bonde CFO, deputy CEO Vattenfall , Sweden
Anders Eldrup Former CEO DONG Energy, Chairman Copenhagen
Henrik Ehrnrooth Chairman, Caverio, Pöyry och YIT, Finland
Ulrik Federspiel Executive Vice President Haldor Topsoe A/S,
Anders Olsson Deputy CEO E.ON Norden, Sweden
Background and assumptions
• The Nordic countries are comparably far in
transition to sustainable energy
• Nordic governments aim at Zero emission targets
for 2050 (IEA interpretation)
• This will necessitate very large investments in
renewables, transmission, energy efficiency and
• A proactive, bottom-up approach from Nordic
Business can lead to competitive strength for the
• The Nordic countries have a story to tell in the EU
– especially the trans boundary electricity market
• We can do more - and it is more efficient if cooperating
• There is a potential for further increase in renewable
energy in the Nordics, at competitive prices
– a portfolio with potential for net export and
balancing electricity market in northern Europe
• The transition will need a gradually higher price on CO2
• Nordic Green Industrial Clusters can develop further
1. A Nordic Energy Way
2. A Nordic Energy Road Map – we can do more
– High efficiency/Low Energy Economy
– A Nordic Battery and Renewable Energy Hub
– Nordpool 3.0
3. A Nordic Voice – there is a story to tell
4. A Nordic Funding Model and Incentives
5. Nordic Green Industrial Cluster
2.1 High Efficiency Economy
High potential. Many measures already profitable but do not happen...
• Transport sector
• Housing sector
• Industry and Service Sector
• Take lead in early market for electric cars.
• Pioneering region in electrification of roads.
• Nordic building standards, gradually strengthened towards zero.
• Use the EU compulsory energy declaration as a basis for targets
based on Nordic best practice.
• Nordic voluntary scheme for energy improvements for industries,
including tax incentives and sharing of know-how.
2.2 Nordic Battery and Renewable
Capacity to export renewable energy (electricity, maybe biofuels)
as well as a balancing region on the European markets
• Increase integration across Nordic renewable support
• Utilize co-operation mechanism within the EU RES directive
• Technology specific support only for non mature technologies
• New transmission investments within Nordic counties and to
A thought experiment
• Assume export of 50-100 TWh of renewable electricity (IEA/Nordic
• Yearly export earnings of € 50-100 million.
• Reducing European CO2 emissions by 40-90 million tonnes
(replacing coal condensing power)
• Reduced cost for European climate policy
• Increase potential for wind and solar in northern Europe.
• Direct yearly cost benefits for Nordic business and households
relative to continental Europe
• Industrial development, improved investment climate,
innovation, jobs creation, stronger competitiveness etc. in the
Export electricity price the lowest assumption among IEA main scenarios, USD 136/MWh
2.3 Nordpool 3.0
The worlds first and most successful multinational
power market. 3.0 comes with flexible supply,
export of surplus and flexible demand in real
• Design the Nordic market to retain and develop
• Promote Nordic solutions for Europen market
• Strengthen R&D efforts to adapt Nordpool to the
emerging energy scene.
3. A Nordic Voice
Nordic governments and business should join forces
to develop a strong voice for
• …an open, single, interconnected European
• …the economic benefits for all by avoiding
isolated, national capacity markets
• broader use of taxation on carbon and stricter
application of the EU-ETS
• …Nordic market model design for use in the EU.
4.1 Increased price on carbon
The key is carbon pricing.
• A wider use of carbon taxation within the EU
as well as a stricter application of the EU ETS
in order to raise the end price for using fossil
• Nordic countries can show the way by
pursuing a further shift to tax on energy and
4.2 Investment opportuntities
• Bring together a large number of national and
Nordic entities under a “Nordic Energy
Financing Center”, not to replace present
institutions but to take a leading role in
coordinating the present institutional set-up.
4.3 Nordic Energy Research
• Bring together smaller actors under a common
and strengthened head institution, for
example Nordic Energy Research, which could
then more effectively perform its tasks as a
contributor and coordinator.
5. Nordic Energy Green Clusters with
• Wind power - focus on cold climate, off shore and
• Climate efficient biofuels from indigenous sources.
• Electrification of transport including vehicles, charging
infrastructure and electrification of roads.
• Combined operation of heat and electric power
systems, including efficient use of heat pumps.
• Smart electrical grids combining IT with power.
• Solar power solutions.
Possible following steps
• Dialogue with governments and other stake
• Contribute to a (northern) European discussion
• Deepening of some proposals.
– the industrial perspectives
• Studies of economic benefits, quantified?
Possibly even modelling of connected grids (including heat
Swedish Climate Policy Update
• On track to 2020 targets
• Roadmap to zero net emissions 2050
– not yet any targets between 2020 and 2050
• Vehicle fleet independent of fossil fuels by
2030 – proposed strategy in december
• International initiatives
– short lived green house gases
– climate economy – the benefit of action