Smart grid promotion policy and activity in Sweden Sweden day, October 23, Smart City Week 2013

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1 Smart grid promotion policy and activity in Sweden Sweden day, October 23, Smart City Week 2013 Karin Widegren, Director Swedish Coordination Council for Smart Grid

2 Outline of presentation Who we are - the Swedish Coordination Council for Smart Grid Converting to a sustainable energy system - Swedish experiences and challenges The Swedish electricity market prerequisites and policies for smart grid Smart grid activities in Sweden

3 The Swedish Coordination Council for Smart Grid

4 The Coordination Council for Smart Grid Overall Mission Coordinate and stimulate cooperation, knowledge transfer and discussions among stakeholders Deliver proposals to remove barriers and stimulate the development of smart grid in Sweden incl. R&D Assignment Appointed by the Swedish Government members: key positions within industry, governmental authorities and academia Present a national action plan for the period by Dec 1, 2014

5 Vision and objective Sweden will have a leading position in smart grid enabling customer empowerment, sustainable development, security of supply and economic growth. Through increased cooperation, knowledge development and dissemination and a national action plan contribute to: clear and fair rules on the emerging smart grid market customer empowerment favourable conditions for the development of smart grid in Sweden making smart grid a growing Swedish industry

6 Focus areas defined by the Council Smart grid as part of the wider energy system Electricity market incentive structure and customer empowerment R&D and knowledge provision Information security and integrity Economic growth, business development and international relations Standards and interoperability Communication and desimination

7 Converting to a sustainable energy system - Swedish experiences and challenges

8 Share of fossil fuels in total energy supply (IEA member countries) Source: IEA

9 Sweden s total share of renewable energy sources,

10 Sweden - a low-carbon economy Almost no CO2 emissions in electricity production mainly hydro and nuclear Energy tax on electricity and fuels since decades Carbon dioxide taxation since 1991 Green certificate system for RE since 2003 Emissions trading since 2005 Information, education, innovation and RD&D Various specific programmes and support systems over the years.

11 The way forward Objectives for 2020 at least 50 % RE of total energy use at least 10 % RE in transport 20 % more efficient energy use 40 % reduction in greenhouse gas emissions Vision By 2020, fossil fuels for heating will be phased out By 2030, Sweden should have a vehicle stock that is independent of fossil fuels By 2050, a sustainable and resource-efficient energy system and no net emissions of green house gases

12 The Swedish electricity market prerequisites and policies for smart grid

13 Electricity consumption High electricity consumption (15000 kwh per capita) due to cold climate and extensive energy intensive industries High penetration of electrical heating - limited gas market Well developed district heating systems - high use of bioenergy High efficiency standards in building Typical consumption per household: single family buildings with electrical heating kwh, apartments 4000 kwh

14 The wholesale electricity market Long tradition of power exchange between the Nordic countries to foster a efficient utilization of different power production resources Deregulation started in the mid-1990s and by 2000 all Nordic countries were deregulated. Since 2000 further integration of the Nordic wholesale markets with Nord Pool playing a mayor role High liquidity - About 75 % of the power generated in the Nordic region is traded via Nord Pool Spot

15 Distribution and retail market Distribution National Grid, Svenska kraftnät kv Regional networks - 4 operators kv Local networks operators < 40 kv, three companies have 50 % of the customers Market actors and market activities Annual electricity consumption ~ 140 TWh 5.3 million customers - 4,5 million residential Legal unbundling, 120 electricity suppliers, High customer activity, rate of switching > 30%

16 Smart grid activities in Sweden

17 How do we define smart grid? Smart grid or intelligent network: the collection of new technology, functionality and regulation on the electricity market that cost-effectively enables integration and use of renewable electricity production, contributes to power reduction during peak load, results in more efficient energy consumption, and creates conditions for more active customers including the implementation of demand response. Smart grid is not an aim in itself but offers a rational way to meet these challenges and to develop a cleaner and more efficient energy supply

18 Future Challenges Higher degree of complexity demands changes and adaptation of the electricity network Integration of large scale renewables Integration of distributed generation Electric vehicles integration Keeping and enhance quality and security of supply Forecasts and handling of peak load and excess power balance avoiding curtailment An electricity market in transformation - new business models and new services Empowered and active customers Demand response Energy storage, aggregation Energy efficiency services Demand profiles difficult to predict Flexibility is key!

19 Flexibility is not only technology - understanding customer behavior Customers reactions to new market possibilities timeframe needed to adapt? How to create incentives attractive enough to activate early adopters? Different kinds of incentives for different kind of costumers needed economy, simplicity, environmental concern, independence etc. Demand response and price formation how do we get it right?

20 Roll out of smart meters July 1, 2006; Mandatory hourly meter reading for all customers above 63 A; before above 200 A July 1, 2009; Mandatory monthly meter reading for all customers (5,2 million) was introduces A major roll-out of remotely read electricity meters 99 % of all meters was replaced by 1st of July 2009 No legal demands on functionalities or communication systems

21 Functionalities of meters installed About 90 % of the meters are capable of hourly meter reading etc. About 50 % of the meter systems installed are capable and used to provide customers with hourly meter data - of these almost 90 % are updating the information every 24h. Over 90 % are using webb-based solutions data flow interface at the meter is very rarely used by utilities. About 30 % of the meter systems installed are equipped with a port for Home Area Network.

22 Next step hourly meter reading October 1, 2012; Obligation for network companies to deliver hourly data at no extra cost for customers subscribing to a hourly-based contract Evaluation conducted by the regulator covering the first 5 months - so far only customers have chosen hourly based contracts Market activities Half of the responding suppliers are offering hourly based contracts however rarely advertised Very few of these suppliers are offering additional services facilitating a smarter use of energy Only 20 of 113 network companies have been contacted by service providers to get access to hourly data on behalf of consumers

23 Elements in a strategy to engage and empower customers Information and knowledge about own consumption patterns and possibilities for change crucial Attractive offers from supplier or third parties possibly bundled with other services Easy access to meter data by third parties if decided by the customer Obligation for the DSO to supply 3 rd parties with data Separate interface and decentralized data handling Structure of network tariffs and other cost elements an important part of the incentive structure

24 Large research programmes National inventory of R&D projects will be presente d soon! EIT KIC InnoEnergy Sweden European Node for Innovation on Smart Grids and energy storage ELEKTRA Research program in electrical power engineering in close cooperation with industry SweGRIDS Swedish research program in Smart Grids and energy storage

25 Example Demonstration Projects Stockholm Royal Seaport ($30M) Large-scale urban Smart Grid demonstration project Smart Grid Gotland ($20M) Large-scale rural Smart Grid demonstration project Stockholm Royal Seaport Smart Grid Hyllie ($25M) Large-scale Smart City project in Malmö Malmö city Gotland Island

26 Thank you for your attention!

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