In early October, we attended the Nordic Conference on Electricity Market Development and Electrification, sponsored by the Swedish government, and hosted by Regeringskansliet. Here are our key takeaways from the event:
- Massive investments needed: Electrifying Europe will require €600 billion per year for five years. But while the focus is on energy production, the grid infrastructure is half of this enormous number and is being overlooked—and Europe will literally run out of copper before hitting our targets.
- Pricing and permitting: Shorter permitting processes are critical. But even more importantly is we need to do everything we can to create more flexibility in the grid.
- There’s debate about shifting from marginal cost pricing to fixed price models to stabilize energy markets. Problem is that if the regulation is too beneficial no ones complains, and if too low no one will do it.
- National vs. regional approach: Should energy systems be designed for Sweden, the Nordics, or the EU? And should they prioritize cost or sustainability? Sweden’s energy leader stresses national interests and policy priorities must take precedence as energy policy is still national in the EU.
- Flexibility and storage: Energy storage (BESS) will play a key role, with batteries deployed to key hubs. Investing in grid infrastructure and integrating hydrogen is crucial for a sustainable future. Europe’s electrification must focus as much on flexibility and infrastructure as on renewable production.
