Historical Government support for wind energy in Sweden – 2010

The following is a look back at the market for wind energy in 2010 and describes the outlooks and targets set at the time.

In 2003, Sweden introduced a tradable green certificate support system, which gives producers of renewable electricity (wind, small hydro, biomass based CHP) economic support for every MWh they produce.

The current support system is designed to produce 17 additional TWh of renewable electricity by 2016, made up of 7 to 8 TWh of wind power, the same volume of biomass based CHP and about 2TWh of small hydro. The system encourages the cheapest means of production to be built first, which creates competition between wind, biomass and small hydro.

The Swedish system is a market based certificate programme in which the producer of renewable energy receives one certificate for every MWh of electricity produced. New production capacity can receive certificates for up to 15 years after production starts. After this time period, they are no longer eligible for additional certificates. The quota system has recently been extended to 2030 in order to give new generation capacity coming online in 2016 the ability to earn certificates for the maximum fifteen years.

Utilities are required to meet a certain percentage of renewable energy by purchasing these certificates. Thus, market prices are set by the amount of certificates available and the amount of demand for these certificates.

On February 5, 2009, the coalition Government reached an internal agreement to promote renewable energy further. The target for the certificate system will be increased to 25 TWh by 2020, which will allow for some 15 TWh of onshore wind power to be built. In addition, the Government will develop a separate support system for offshore wind power.

The Swedish government has set a new target of renewable energy contributing 49% of Sweden’s power needs by 2020, with 30 TWh of wind power.

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