Nordic Energy Technology Perspectives 2016.

269 Pages·014.123 MB·English

by  OECD

Nordic Energy Technology
Perspectives 2016
Cities, flexibility and pathways to carbon-neutrality
Copyright © 2016 Nordic Energy Technology Perspectives 2016
OECD/IEA, 9 rue de la Fédération, 75739 Paris Cedex 15, France
Nordic Energy Research, Stensberggata 25, NO-0170 Oslo, Norway,
Risø DTU, Ea Energianalyse A/S, (EAEA), VTT Technical Research Centre of Finland (VTT),
University of Iceland (UI), Institute For Energy Technology (IFE), Profu Ab (Profu) and IVL
Swedish Environmental Research Institute (IVL).
This Nordic ETP technology paper is the result of a collaborative effort between the International
Energy Agency (IEA), Nordic Energy Research (NER), Risø DTU, Ea Energianalyse A/S, (EAEA),
VTT Technical Research Centre of Finland (VTT), University of Iceland (UI), Institute For Energy
Technology (IFE), Profu Ab (Profu) and IVL Swedish Environmental Research Institute (IVL).
This Nordic ETP technology paper reflects the views of the IEA Secretariat, NER, Risø DTU,
EAEA, VTT, UI, IFE, Profu and IVL, but does not necessarily reflect those of their respective
individual Member countries or funders. The Nordic ETP technology paper does not constitute
professional advice on any specific issue or situation. NER, the IEA, Risø DTU, EAEA, VTT, UI,
IFE, Profu and IVL make no representation or warranty, express or implied, in respect of the
contents of the Nordic ETP technology paper (including its completeness or accuracy) and shall
not be responsible for any use of, or reliance on, it. For further information, please contact:
[email protected].
This publication reflects the views of the IEA Secretariat, but does not necessarily reflect those
of their respective individual member countries [or funders]. The IEA make no representation
or warranty, express or implied, in respect to the publication’s contents (including its completeness
or accuracy) and shall not be responsible for any use of, or reliance on, the publication
This document and any map included herein are without prejudice to the status of or sovereignty
over any territory, to the delimitation of international frontiers and boundaries, and to the name
of any territory, city or area.
Figures and data in this report can be downloaded at www.iea.org/etp/nordic
Nordic Energy Technology
Perspectives 2016
Cities, flexibility and pathways to carbon-neutrality
Figures and data in this report can be downloaded for free on the websites
of the International Energy Agency and Nordic Energy Research:
www.iea.org/etp/nordic
www.nordicetp.org
INTERNATIONAL ENERGY AGENCY
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The Agency’s aims include the following objectives:
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to climate change.
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energy data.
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Nordic Energy Technology Perspectives 2016 Table of Contents
Table of Contents
Introduction 5

Foreword 5
Acknowledgements 7
Contact 9
Executive Summary 10
Nordic energy-related carbon dioxide emissions 26
Chapter 1 Nordic choices in a global world 28

Radical change is needed, but history gives cause for optimism 31
Three strategic issues facing Nordic countries 35
Power generation and district heating are almost there 42
Spotlight 1: The Nordic bioenergy market 52
Decarbonising transport poses significant challenges 57
Industry: Innovation will be the deal breaker 72
Spotlight 2: Iceland´s fishing sector 83
Buildings: Accelerating deep energy renovation is critical 88
Decarbonising the Nordic region will not cost the world 101
Chapter 2 Urban energy 104

Introduction 107
Overview of Nordic urban energy systems 108
Drivers of change in the urban context 114
Urban scenarios 119
Nordic capitals leading the low-carbon transition by example 129
Recommendations for action in urban areas 147
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Nordic Energy Technology Perspectives 2016 Table of Contents
Chapter 3 Electricity system integration 150

Introduction 153
Market integration of VRE 173
Electricity trade 180
Flexibility in the system and VRE integration 189
The role of nuclear in the Nordic energy system 210
Recommendations and near-term actions 213
Annexes 216

Annex A (Chapter 1) 217
Annex B (Chapter 2) 230
Annex C (Chapter 3) 235
References 245
List of Figures 254
List of Boxes 260
List of Tables 261
Also from the IEA 264
New releases 264
7
Nordic Energy Technology Perspectives 2016 Foreword
Foreword
Much has changed since the last edition of Nordic Energy Technology Perspectives (NETP) in
2013. Despite lower fossil fuel prices, the Nordic region has continued to reduce emissions.
This decline is the result of efficiency improvements and strong renewables growth – evidence
that energy policies suggested in the last report are producing results. Similar developments
are evident across Europe, where the Energy Union has established a new framework for
European energy policy. Globally, too, efforts to cut CO have gained momentum. At the time
2
of writing, 189 countries had pledged to reduce emissions under the framework of the Paris
Agreement on climate change, which has already been signed by more than 170 country
representatives. Policy makers around the world are now looking to fulfil these pledges. The
experiences of the Nordic region in energy system transition can offer a valuable contribution
as the world takes on this challenge. The highly interconnected regional electricity market
is the cornerstone of the Nordic energy system, and it can serve as a key enabler for further
emission reductions towards 2050.
This report provides a case study on how to go beyond the 2°C target, towards a carbon-
neutral energy system. For Nordic policy makers, the scenarios in this report identify both
challenges and opportunities on the road towards the ambitious national climate targets of
the region. Their success will depend on ensuring public acceptance of new power generation
and grid investments, the continued competitiveness of energy-intensive industries amidst
higher electricity prices, and the sustainable supply of biofuels for long-distance transport.
In addition, there are significant opportunities to benefit from supplying and balancing the
European electricity grid, and to harness urban leadership in the electrification of transport.
NETP 2016 is the largest IEA collaborative analytical effort looking at regional long-term
low-carbon technology pathways. The report applies the global energy scenarios of the IEA
Energy Technology Perspectives report to the five Nordic countries, utilising rich national data
and addressing issues specific to the Nordic countries. It builds directly on the first edition
of the report from 2013, which has become a key point of reference for various subsequent
analyses from Nordic governments, industry and civil society.
Just as in the global IEA Energy Technology Perspectives report, urban energy systems and
electricity system integration are topics garnering special attention in this edition, where
leading Nordic researchers have used specialised modelling tools to supplement the IEA model
central to the scenarios. The result is a more detailed and region-specific assessment of
renewables buildout and electricity trade than was possible in the first edition. Tight co-operation
between IEA and Nordic researchers has been critical to this endeavour, which has benefited
both sides immensely. It is our hope that this fruitful co operation will continue and be extended
to other countries and regions of the world.
Kamel Ben Naceur Hans Jørgen Koch
Director Executive Director
Sustainability, Technology and Outlooks Nordic Energy Research, Oslo
International Energy Agency, Paris

9
Nordic Energy Technology Perspectives 2016 Acknowledgements
Acknowledgements
Nordic Energy Technology Perspectives is a collaborative project between the International
Energy Agency (IEA), Nordic research institutions and Nordic Energy Research – an
intergovernmental organisation under the Nordic Council of Ministers.
Benjamin Donald Smith at Nordic Energy Research was the coordinator of the project.
Markus Wråke at IVL Swedish Environmental Research Institute was the analytical project
manager and had overall responsibility for the design and implementation of the study.
Daniele Poponi led the analysis at the IEA.
Special thanks go to Nordic Energy Research Executive Director Hans Jørgen Koch and
Jean-Francois Gagné, head of the ETP division at the IEA, who have been driving forces
behind the project.
IEA team
Pierpaolo Cazzola, Astrid Dumond, John Dulac, Araceli Fernández Palés, Marine Gorner,
Lorcan Lyons, Luis Munuera, Daniele Poponi, Uwe Remme, Jacob Teter, Therese Walsh
and Kira West.
Nordic Energy Research
Hans Jørgen Koch, Svend Søyland and Benjamin Donald Smith.
Danish team
Kenneth Bernard Karlsson, Marie Münster, Klaus Skytte, Cristian Hernán Cabrera Pérez,
Giada Venturini, Raffaele Salvucci and Rasmus Bo Bramstoft Pedersen (DTU); Anders
Kofoed-Wiuff, János Hethey, Nina Dupont and Simon Sawatzki (EA Energy Analyses).
Finnish team
Tiina Koljonen, Tomi J. Lindroos, Antti Lehtilä, Göran Koreneff and Miimu Airaksinen (VTT).
Icelandic team
Brynhildur Davidsdottir, Conor Byrne, Reza Fazeli, Ehsan Shafiei, Sigurdur Jóhannesson and
Darri Eyþorsson (University of Iceland); Jonas Hlynur Hallgrimsson (EFLA Engineering).
Norwegian team
Kari Aamodt Espegren, Arne Lind, Eva Rosenberg (IFE); Glen Peters, Jonas Karstensen and
Robbie Andrew (CICERO).
Swedish team
Fredrik Martinsson, Marcus Liljeberg and Markus Wråke (IVL); Thomas Unger and Mattias
Bisaillon (Profu).
10
Nordic Energy Technology Perspectives 2016 Acknowledgements
Editing
Justin French-Brooks, Marilyn Smith and Jonas Wiesel.
Layout
Steffen Brückner
Nordic Reference group
The work was guided by the Nordic Reference Group, consisting of:
Karsten Kapion and Peter Meibom (Danish Energy Association), Jeppe Lundbæk (Danish
Energy Agency), Erla Björk Thorgeirsdottir and Jónas Ketilsson (National Energy Authority
of Iceland), Jari Kostama (Finnish Energy), Petteri Kuuva (Ministry of Economy and the
Employment, Birgitte Liard and Elin Økstad (Norwegian Environment Agency), Hans Otto
Haaland (Norwegian Research Council), Filip Ehrle Elveling and Åsa Leander (Swedish
Ministry of Environment and Energy), Klaus Hammes (Swedish Energy Agency), Estathios
Peteves (EU Joint Research Centre, Petten)
In addition, we are very grateful for input and comments from the following people:
Anna Andersson (Swedish Energy Agency), Johan Berg (Heat Pump Centre), Brian Dean
(IEA), Joakim Cejie (Swedish Ministry of Environment and Energy), Dag Christensen (Energy
Norway), Chiara Delmastro (Politecnico di Torino), Audun Fidje (Norwegian Water Resources
and Energy Directorate), Iratxe Gonzalez (JRC IET) Klaus Hammes (Swedish Energy Agency),
Anders Bavnhøj Hansen (Energinet DK), Ignacio Hidalgo (JRC IET), Hrönn Hrafnsdóttir (City
of Reykjavik), Eva Jernbäcker (Swedish Ministry of Environment and Energy), Sigurður
Jóhannesson (University of Iceland), Andreas Kannesten (Swedish Ministry of Environment
an Energy) Marc LaFrance (US Department of Energy), Ágústa Loftsdóttir (National Energy
Authority of Iceland), Jukka Leskela (Finnish Energy Industries), Elisabeth Lidbaum (Swedish
Ministry of Environment and Energy), Ole Løfsnæs (Norsk Industri), Fredrik Norlund (Swedish
Ministry of Environment and Energy), Roger Nordman (Heat Pump Centre), Wouter Nijs (JRC
IET), Mikael Odenberger (Chalmers), Lina Palm (Uniper), Martin Palm (Swedish Ministry of
Environment and Energy), Julia Panzer (Danfoss), Cristian Hernán Cabrera Pérez (Technical
University of Denmark), Pentti Puhakka (Finland TEM), Eva Rosenberg (Institute for Energy
and Technology Norway), Pablo Ruiz (JRC IET), Caroline Haglund Stignor (Heat Pump Centre),
Andreas Zucker (JRC IET), Hans Rudling (Fortum Värme), Erik Dotzauer (Fortum Värme),
Christer Boberg (Fortum Värme), Jan Bråten (Statnett).
The project was made possible through funding from Nordic Energy Research. Special
thanks go to then Board members: Nicolai Zarganis and Flemming G. Nielsen (Danish
Energy Agency), Sebastian Johansson (Tekes, Finland), Gudni A. Jóhannesson and Erla Björk
Þorgeirsdóttir (Orkustofnun, Iceland), Rune Volla and Hans Otto Haaland (Research Council
of Norway), Astrid Stavseng (Norwegian Ministry of Petroleum and Energy), Lars Guldbrand
(Swedish Ministry of Environment and Energy) and Birgitta Palmberger (Swedish Energy
Agency).
The individuals and organisations that contributed to this study are not responsible for any
opinions or judgements contained in this study. Any errors and omissions are solely the
responsibility of the IEA.