Conservative energy policy still clouds the skies

Swedish zoning laws and political attitudes to wind energy are hampering development in the south, while the north seems to offer an open--and waiting--market.

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Despite a wind energy forecast for clearing skies in Sweden following the country's new energy law, the mood at the annual Swedish wind energy conference was surprisingly gloomy. Dark clouds were mostly blown in by Swedish politicians and planning authorities who have almost paralysed development of new wind plant, even though wind energy enjoys wide public support. But talk of rising demand for wind produced electricity and of positive attitudes for wind power in the northern mountain regions gave some hope for the future.

Vind 97 was the ninth Swedish wind conference, attracting 125 participants to Malmø during the two days of May 27-28. The gloom began when a scheduled report on the acceleration of wind power development, due to be presented by government agency Nutek, was taken off the agenda. The mood darkened still further with the cancellation of a debate with politicians on wind power policy: none of the politicians apparently considered the topic important enough to put in an appearance.

The dreariness of the opening was accentuated when Sydkraft utility's Lennart Fredenborg said his company will do all in its might to keep its Barsebäck nuclear reactor on line. This is despite the government's announcement that it will start Sweden's phasing out of the use of nuclear power by closing Barsebäck. He reminded the audience about the unfulfilled government decision to close a reactor in 1988. "They will not succeed this time either," he stated firmly. A "premature" phasing out of nuclear power will inevitably lead to an increase of coal-fired power generation -- imported from Danish power plants -- he added. Wind power was apparently not considered as part of the equation.

Still, Fredenborg explained that Sydkraft has had a more positive attitude to wind power than a few years ago, when the company felled a just retrofitted large turbine in Maglarp. Last year Sydkraft bought a wind farm on the island of Gipsön, consisting of twelve 600 kW Vestas turbines (Windpower Monthly, July 1996). That was a strictly commercial decision, Fredenborg said, since Sydkraft wanted to diversify its portfolio in a period when demand for wind generated power was increasing. Indeed, conference organiser Sven Erik Thor said wind power development was going faster than even the most optimistic prognoses dared to forecast just a few years ago.

Competitive bidding

Following the conference's opening downpour, Hans Ohlsson from Nutek clarified details of the country's new energy law (Windpower Monthly, May 1997). He explained there is more to the allotted SEK 300 million for wind power's 15% investment subsidies than meets the eye. This amount can be increased if deemed necessary, he said, and a separate amount of SEK 100 million has already been allocated for a specific wind project tender. A competitive tender for a specific amount of wind power is favoured by Nutek to bring costs down. The procedure was used last year when several small projects were aggregated into one large order, won by Danish wind turbine manufacturer Bonus (Windpower Monthly, December 1996).

The new law also pledges economic support for full scale demonstration of Sweden's flexible turbine concepts as well as offshore and even Arctic wind farms. It allocates some SEK 2.3 billion to research and development for renewable energy, too. How much of that will be used for wind power has not yet been decided. In coming years, Ohlsson added, Nutek will most likely apply a competitive bidding system to wind development similar to the British Non Fossil Fuel Obligation.

Meantime, Nutek's bureaucratic hard line approach to wind subsidy applications has been criticised for delaying development of projects that already have all their permits. What is more, Nutek will not accept applications before July 1, Ohlsson said, and applications made in the last round, which did not receive funds must be renewed.

Banking on wind

Financing and economics was a major conference topic. Credit terms are more important today for the economics of wind power than technical innovation, said Claes Nilsson from Föreningsbanken, a Gotland bank tied to the agricultural sector that has provided tailor-made loans to many wind power projects. The loans are segmented to handle fluctuating incomes of good or bad wind years, said Nilsson, with five year fixed interest rates. Repayment time varies from five to 15 years. Using environmental loans from the EU Investment bank -- which furnishes security for 50% of the loans -- eases loan funding. A wind project must still fulfil 35 economic viability requirements before any loans will be granted, Nilsson explained.

Beyond strict economics, Lennart Söder from the Royal Technical University in Stockholm explained how wind can add value to the power system. On the universal question of wind's capacity credit, Söder stressed that wind power diminishes losses in the system grid and adds value to regulated hydro power, among other positive aspects. However, these values are strictly dependent on local conditions and there are no simple "rules of thumb" to calculate them. In some instances wind power can also have a negative value for the system.

Zoning map in the red

The results of a Nutek study on the barriers to wind development shed light on the real problem for Swedish wind power development. Consultant Staffan Engström reported that the country's energy policy (prior to the new energy bill), lack of state support and difficulties in getting building permission were the greatest obstacles. Local public opinion was not judged a problem at all.

This point was subsequently illustrated in a presentation by Lena Gerdtsson from the planning office in Skåne, the southernmost region in Sweden with the hottest wind power market. Gerdtsson referred to the difficulties of finding space for several hundred turbines that must be installed to fulfil a "national interest" quota for the region decided by government. Her office's comprehensive location study for wind turbines ruled out all the best sites. Other interests have prior claims, she said. Andreas Wickman from wind development company Vindkompaniet commented that this gave him a feeling of total hopelessness. Wind, he said, had no priority over other land use.

Work to identify areas where wind power can be developed in the "national interest" to provide 2 TWh of electricity a year is proceeding according to schedule, said Stefan Jakelius from Nutek. New regional wind maps have already been made for most areas and regional authorities are now to identify specific areas for wind development. Jakelius hopes this will be done within another six months. Once this comprehensive zoning plan for wind plant is complete, project developers expect planning permission to be easier to obtain.

Northern light

Northern communities and regional authorities seem to have a much more positive attitude towards wind power than the south, with the result that potential wind plant developers have flocked to the region in recent months. A wind development project in Jämtland, consisting of six 600 kW turbines on two mountain tops, received much attention after it was blocked by the Swedish environmental protection agency, a decision which was subsequently overruled in June by Sweden's highest court for environmental legal disputes.

Regional planning officials, encouraged by the court's decision, have since been further impressed by reports from their Finnish neighbours about the operation of wind turbines in extreme climatic conditions. The Finns are known for their pioneering work in operating and maintaining wind plant in the Arctic region; lessons learned since 1993 from operating a 220 kW Wind World turbine in conditions of extreme ice and frost on top of Pyhdtundturi mountain in Finland have subsequently been applied to other projects.

Last year two 450 kW Bonus turbines were installed in Finland on Lammasoaivi mountain in Enontekio, a village on the Norwegian border. Despite some minor problems, the machines' heating systems performed well, controlling frost and ice on the blades, prompting the Finnish project developers to conclude that Arctic wind power problems have been solved.

Now the regional Jämtland authorities in Sweden have started preparation of a general plan for wind power development, with several projects already in motion by private developers, local communities and utilities. Even ski resorts have come into the picture, wanting to enhance their "green" image with wind powered lifts.

With this talk of wind development in the north, Sweden's new 15% investment subsidy programme contained in the energy law -- and the zoning for wind power plant in the "national interest" expected to be finalised by the end of the year -- the future forecast for wind power in Sweden seems to be for clearer skies and steady breezes.

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