Windy north becomes the new frontier -- Slow year in Sweden

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The Swedish wind power market in 2006 was one of expectations greatly postponed. Just 62 MW MW came online according to the Swedish energy agency, an increase of less than 10%, to bring wind capacity to 572 MW, producing around 1 TWh a year. The coming year looks little better. While three relatively large land-based projects, Bondön, Storrun, and Uljabuouda, with a combined capacity of 100 MW, should break ground, none of them will be running until 2008. The government's goal of getting 10 TWh from wind power by 2015 looks like a stretch, even with the 110 MW Lillgrund project coming online (page 81).

While two years ago pundits claimed offshore development was the answer to Sweden's wind power needs, now there is a noticeable rush to get back on land. The higher costs of going offshore have developers hightailing it to the north and north-west, where new wind resource maps reveal areas where it blows 6.5 m/s and more. The north is the new frontier, partly opened up by government decisions to streamline permitting and extend the horizon for trade of green energy certificates to 2030.

The last three months has seen a bonanza of project planning. Green certificates are currently fetching about SEK 0.20/kWh (EUR 0.02/kWh), which seems to be enough for developers. But they want the government to contribute to the cost of grid capacity expansion to improve project economics.

Uljabuouda, a 36 MW project owned by Skellefteå Kraft in the low mountains of the north, just received a SEK 35 million (EUR 3.8 million) research grant from the energy department. The project will provide data on wind turbine operation in sub-zero cold temperatures and on how to mitigate disturbances to the northern bird life and reindeer herds. A further SEK 350 million (EUR 38 million) of wind research funds are available for the next year or so and the government plans to focus on projects similar to Uljabuouda.

Mikael Kyrk of independent company Svevind has six projects lined up, five in the northern half of Sweden, the largest of which is planned for at least 300 MW. Kyrk is bullish about northern development but says there are problems. "If there's a boom coming, there are also bottlenecks to deal with." The environmental court has a backlog of 400 cases overall, he says, which could be a significant barrier. "There's also the grid. I think it can handle 1000 MW more, but not more than that." Getting big turbines to far flung and cold sites will also be a serious logistical challenge. "If the boom is coming I hope the producers and suppliers see they've got to come too."

Further development announcements are likely in 2007. Vattenfall has continued to work with Gamesa, albeit slowly, on planning 300 MW of turn-key, land-based projects. Gamesa must get permits for projects before pitching them to Vattenfall. "If we can make a deal on some of these projects, they could be up and running within one year," believes Anders Dahl of Vattenfall's wind investment group.

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