16 December 2022
Swedish Government likely to back out of election promises on fuel due to EU emission requirements
During the election campaign, the parties in government promised sharp reductions on the price of petrol and diesel by lowering fuel tax. They also promised that the mixing of renewable fuels in petrol and diesel, called the reduction obligation (Sw. reduktionsplikt) should be lowered to the EU's lowest level. In time, this would also lower the price of diesel by SEK 5–7 per litre. If the reduction obligation is reduced as much as promised, however, Sweden would be in breach of the EU's emissions requirements – something that could cost many billions. The EU's climate goals mean that Sweden must reduce its emissions by 50% by 2030 compared to 2005. With the government’s proposals, Sweden will crack the emissions budget considerably. The government might therefore have to back out of this election promise. When asked if the government promised too much during the election, the Minister for Climate and the Environment, Romina Pourmokhtari (L), said that not all parties were behind such a sharp reduction. She stressed that the government will be looking into how they can keep the reduction obligation at the lowest rate, as promised.
According to the Sweden Democrats’ Spokesperson for Climate Policy, Martin Kinnunen (SD), he had not been informed that the government is investigating how much the reduction obligation can be limited in order to still keep Sweden within the EU’s emission requirements. However, he was quick to underline that a marginal reduction is “out of the question,” since a lowered price of SEK 5-7 per litre is something that they promised the Swedish people.
Dagens Nyheter, TV4, Dagens Nyheter
Sweden delivers SEK 4 billion to the Global Environment Facility
Yesterday, the government announced that Sweden will contribute over SEK 4 billion to the environmental fund Global Environment Facility (GEF). Sweden is one of the largest donors along with Japan, Germany and the US. Through the fund, low and middle-income countries can receive support for climate and environmental efforts. It is the eighth time that the fund has been replenished, and total support amounts to approximately SEK 55 billion.
Swedish electricity consumption declines by 9.5% in November
The electricity operator Svenska Kraftnät has revealed the results of the latest measurements of electricity consumption in Sweden. Taking into account dates and temperature differences, consumption decreased by 6% compared to November 2021. In southern Sweden, the reduction amounted to 10.1%. Erik Ek, strategic operations manager at Svenska kraftnät, says there are many benefits to reducing consumption during the hours of the day when electricity use is at its peak, which is in the mornings and evenings. Doing this successfully would mean lower electricity bills for both households and companies, as the price is determined on how much it costs to produce the last kilowatt hour needed to meet demand.
Hybrit green steel plant expected to cost SEK 16 billion
Hybrit’s new facility is expected to cost at least SEK 16 billion. Hybrit (which stands for Hydrogen Breakthrough Ironmaking Technology) is a joint venture between LKAB, SSAB and Vattenfall set to produce fossil-free steel. Of the 16 billion, the companies want the state to provide SEK 4.9 billion. That taxpayers should partially finance the vision of three profitable companies has been questioned by politicians on the right, although representatives from the companies disagree: “We are going to develop a completely new breakthrough technology. That’s why support is relevant,” says Martin Pei, initiator of Hybrit. Pei stresses that entire value chains will be dependent on processes where carbon dioxide emissions are removed. About 60 investments in carbon-free steel are underway in the world. "For us, the biggest risk is not making it on time. The climate cannot wait. […] We are first in the world, but if we don't get the support we are entitled to, we risk losing this lead," says Martin Pei. The plant is expected to be ready in 2026, in Gällivare in northern Sweden.
Swedish energy agencies asked to “hoover” the market for untapped potential
On 15 December, the Swedish Government tasked Svenska kraftnät and the Energy Agency (Sw. Energimyndigheten) with mapping untapped potential in existing and unused electricity production sites, as well as identifying why it has not already been made available to the electricity market. The Minister for Energy, Business and Industry, Ebba Busch (KD) has previously suggested reopening the power plant in Stenungsund, something that is still on the table. "Sweden needs to build a robust electricity system that can supply the electricity we need at all hours of the year. All good forces are needed to contribute to the long-term reconstruction of a cost-effective and resilient electricity system that gives us a secure electricity supply," Busch wrote in a comment.
Swedbank Robur introduces method to calculate carbon footprints in fixed income funds
Swedbank Robur has developed and launched a new method for how to calculate and report on the carbon footprint of covered bonds, which is a large part of the capital in traditional fixed income funds. So far, calculations of climate-related factors have been concentrated on equities and corporate bonds, which already possess an established way to measure carbon footprints. Swedbank Robur’s method is based on industry standards for estimating carbon footprints across asset classes developed by the Partnership for Carbon Accounting Financials (PCAF). The figures should be seen as a first estimate that will continue to improve moving forward.
European Energy acquires majority stake in 3,600MW solar hydrogen project
It was recently announced that the Danish renewable energy developer, European Energy, has acquired a majority stake in a solar hydrogen project near the port of Gladstone, Australia. The Pacific Solar Hydrogen Project, which focuses on Power-to-X technology, is expected to reach a capacity of 3,600 MW and aims to produce over 100,000 tonnes of green hydrogen per year. The plan is also for the project to become a hub for renewable energy production and so-called “e-fuels.”
Northvolt's new chairman urges Europe to follow US battery subsidy policy
Jim Hagemann Snabe, chairman of Siemens and former chief executive of software company SAP, will lead the board of Swedish start-up Northvolt, which has received more than USD 55 billion in orders from customers such as BMW, Volkswagen and Volvo Cars. Snabe told the Financial Times that Europe will have to follow the lead of the United States, where President Joe Biden's administration passed the Inflation Reduction Act in August to provide broad subsidies to a range of industrial companies, including batteries. The bill has caused great concern among European policy makers, including French President Emmanuel Macron. Peter Carlson, CEO of Northvolt said they were considering whether to build its next factory in Germany or the US. Not only Northvolt, but also Asian battery companies, are considering moving their investments.
New cooperation project for the development of sea-based hydrogen infrastructure in the Baltic Sea region
Nordion Energi, together with Gasgrid Finland, OX2 and Copenhagen Infrastructure Partners, are involved in a new Baltic Hydrogen Collector (BHC) collaborative project. The project aims to investigate the possibility of developing new large-scale offshore infrastructure for the collection and distribution of green hydrogen between the Baltic Sea region, Finland, Sweden, the Åland Islands, Denmark and Central Europe. This is to enhance energy self-sufficiency and to ensure access to an open, reliable and secure hydrogen energy market. The aim of the project is to create a market for hydrogen and to link supply and demand in the Gulf of Bothnia and the Baltic Sea with Central Europe. The new line will also connect other islands in the region, such as Gotland in Sweden and Bornholm in Denmark.
Norway's Solør Bioenergi acquires Oplandske Bioenergi
Solör Bioenergi, through its company Solør Bioenergi Varme AS, has reached an agreement to purchase shares in Oplandske Bioenergi AS. Oplandske Bioenergi today consists of 23 local district heating and district heating plants that supply energy to industrial, commercial, public buildings and private customers. The total annual energy supply is 60 GWh. This acquisition means that Solör expands its presence in the central-eastern part of Norway.
Fortum and Kärnfull Next collaborate on small modular reactors
Finnish energy company Fortum and Sweden's Kärnfull Next have signed a memorandum of understanding to study the possibility of developing new types of nuclear power in Sweden using small modular reactors (SMRs). The agreement is part of Fortum's two-year preliminary study to explore commercial opportunities for new nuclear power in Finland and Sweden.
Ahlsell invests further in sustainable technologies and acquires Solelgrossisten Sverige AB
Ahlsell has signed an agreement to acquire Solelgrossisten Sverige AB, a player in the field of solar energy, charging and energy storage. With a turnover of SEK 95 million for the financial year 2021, the company is in a very positive phase of development. With this acquisition, Ahlsell can offer its customers a complete range of products for electric vehicles, energy storage and solar energy. In addition, Solelgrossisten has added capabilities and support functions, as well as a proprietary calculation tool for sizing solar cell installations. The acquisition is planned to take place in early January 2023.
Infranode acquires Sola Broadbånd
Infranode has reached an agreement with the municipality of Sola to purchase 100% of the shares in Sola Bredbånd AS for NOK 515 million. The sale has no practical or financial significance for Sola Bredbånd's end customers, who will continue to have contracts with existing fibre operators. The sale of Sola Bredbånd will help to reduce the municipality's debt and free up funds for the municipality's main tasks, thus benefiting all residents.
Vestas receives order for 62 MW in Spain
Vestas has won an order from Norvento Enerxia for a total of 14 wind turbines with a total capacity of 62 MW. The turbines will be installed at several wind farms in Galicia, northwestern Spain. The order also includes a long-term service agreement. The turbines' blades will be manufactured at Vestas' Daimiel plant in Spain. All towers for the turbines will also be manufactured locally. The turbines are scheduled for delivery in 3Q23.
Resource Denmark signs plastics feedstock agreement with Lassila & Tikanoja (L&T)
Resource Denmark, the country's largest plastic waste sorting facility, has secured a feedstock agreement for the supply of at least 20,000 tonnes of Finnish household plastic waste per year, with the first deliveries due in 2023. The annual value of the multi-year contract is in line with the company's expectations. The agreement with the Finnish service company Lassila & Tikanoja is the first of its kind for Resource Denmark, and once up and running it will be a major contributor to achieving Nordic plastic recycling targets.
What we're reading
- ICE warns it may pull gas market from EU over Brussels price cap (Financial Times)
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The Nordic countries are some of the most dynamic and successful economies in the world. They are also leaders in sustainability, from renewable energy, biofuels, carbon capture and storage and the hydrogen economy, circular economy business models and battery development, the Nordics are pioneers in policy design, technology development and consumer uptake. Mundus Nordic Green News is covering this transition for the international community. Every day we curate the stories of most relevance to international businesspeople and policy experts from the flow of news. Mundus Nordic Green Indices summarise the meta-data from our daily coverage to enable easy tracking of trends. We supplement these with our own opinion pieces and commentary.
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