Secret to Sweden's success with renewables? Unambitious targets
From Germany to the United States, Sweden is now being heralded as having an exemplary policy for renewables. A closer look at the country's performance suggests instead that German-style feed-in tariffs are a better idea.
Ever heard of Sweden's nuclear phaseout? In 1980, just after the accident at Three Mile Island and at a time when wind and solar power had hardly been developed, the Swedes resolved to phase out nuclear by 2010. Below is a chart from the country's Energy Agency showing how well that has gone.
As you can see, 2010 came and went, and the Swedes have not managed to phase out nuclear, nor does it look like they are doing much with non-hydro renewables aside from a sliver of wind power at the top. But let's not slight this performance – but according to this ranking published on Tuesday (PDF), Sweden has slightly more wind power installed per capita than Germany does (392 W per person, compared to 389 W in Germany), enough to put Sweden in fourth place internationally (by way of comparison, the US has 38 W per person and the UK 30 W).
The main thing Swedish renewables policy is praised for is keeping costs down. So why do I see such a steep increase in the cost of industry electricity from the Swedish Energy Agency's report (see chart below)? Industry electricity prices have skyrocketed from less than 30 öre around 2000 to nearly 80 öre today, equivalent to 0.09 euros – and a near tripling of prices within just over a decade! In terms of industry power prices, Sweden and Germany are moving closer together (see this comparison).
Those Swedish figures include taxes, so let's take a look at another chart to compare spot market prices. Below, we see that prices have risen considerably since the end of the 1990s, and the average annual price in Sweden was apparently 40-50 öre in the most recent data, equivalent to at least 0.05 euros. I don't need to remind my regular readers that this is drastically higher than spot market prices in Germany, which fell to a record low of less than €0.03 in June. Nonetheless, from the German Monopoly Commission to US President Obama, Swedish renewables policy is held to be a model to copy.
Of course, Sweden and Germany are hard to compare. The Swedes have relatively small population density, with far more per capita biomass and hydro potential than Germany. The Germans are going to have to give it a go with wind and solar, neither of which is dispatchable – and Germany has relatively poor wind and solar resources.
The Swedes already had 47.9% renewable energy (expressed as a share of gross final energy consumption – not just electricity) in 2010, up 5.2 percentage points since 2006. And the country has an, er, “ambitious” target of an additional 1.1 percentage points for 2020 (all the data are here). Compare that to Germany's miserly 11.0% share of renewable energy in 2010, up a mere 4.1 percentage points since 2006. Germany's target for 2020 is 18%, an increase of seven percentage points.
As the European Renewable Energy Council (EREC) explained in July, Sweden is one of only three EU member states on track to meet its 2020 target. Germany is not among those three; the other two are Austria and Italy. Clearly, Sweden is the country to watch if you are a supporter of the energy transition. The lesson to learn from the Swedes is obviously to set your future targets at the current level – et voilá, target reached!
Before I close, let's also bring in the UK, which the German Monopoly Commission and the press have picked up on as another positive example. Let's make this short. The UK aims to increase its share of renewables from the current 4.1% to 15% by 2020, and even more ambitious target than Germany's. But the UK is 25th out of EREC’s ranking of 27 states towards meeting that goal. (Craig Morris)