The idea that the Nordic countries are all the same is as much of an urban legend in the energy sector as it is anywhere else, says Madis Tilga, an adviser with the Estonian office of the Nordic Council of Ministers. Energy production in Iceland, Sweden, Norway, Denmark and Finland – the five countries at the forefront of the green energy movement – differs in a number of ways. This also means that the focal points of research and development in the Nordic region vary from country to country. |
Diversity of energy sources Energy production in the Nordic countries makes use of both renewable resources such as water, wind and biomass and non-renewable resources like oil, gas, coal and – in two of the countries – nuclear energy. Gas and oil form the basis for ca 59% of the primary energy produced in Denmark, 50% in Norway, 40% in Finland, 30% in Sweden and 23% in Iceland. These figures include transport. By way of comparison, the EU average is 63%. The 16% of energy produced from nuclear sources in Finland is certain to grow, with new power plants on the drawing board, while Sweden already draws 30% of its power from nuclear energy. Electricity production in the Nordic countries is comparatively green – more than 60% is produced from renewable resources. Water is most widely used to produce electricity in Norway (99%), Sweden (45%) and Iceland (over 70%). Combined power and heating stations are most common in Denmark and Finland. Energy policy The energy economy in Denmark bears strong links between energy and climate policies. The energy research funding sector stands out for how well coordinated it is: know-how in one field stimulates development in another. For example, advances in wind energy and bioenergy are largely down to the vanguard of the engineering industry and agriculture, respectively. The course of Norwegian energy has primarily been charted by the oil industry, which has been the state's core sector since the 1970s. The innovation scheme in the country has been overwhelmingly funded by entrepreneurs. Compared to the oil industry, the innovation [support] system for renewable energy is modest. Although hydro-energy provides 99% of Norway's electricity, no major investments have been made in the area in the last few decades. More attention has been turned to improving solar batteries. The rise of nuclear energy in Sweden in the 1980s, combined with low energy prices, stifled the need for innovation in what is currently the EU Member State with the highest rate of renewable energy for many years. However, the introduction of green certificates in 2003 was sufficient stimulus for significant investments to start being made in renewable energy once again. At the moment, Sweden is most obviously contributing to biomass and biofuels. Forestry and paper industry technology has been a key catalyst here. The energy sector in the Nordic countries as a whole nevertheless lags behind other industries in the intensity of research and development in the field, particularly in terms of how much is being spent on it. That said, the latest indications are that investment in the field is already proving more viable. Use of public funds in energy research peaked with the oil crisis of the late 1970s, since which the overall spending of OECD countries has decreased. Certain growth has been seen since 2006, although governments continue to allocate less funding than they did in the 1970s. The Nordic countries are adopting two main approaches in their directing and regulating of innovation in the energy sector. Norway and Finland are favouring direct investment support, although Finland is also preparing a Feed-In Tariff Act for wind energy. A feed-in tariff system is already in place in Denmark, while Sweden is the market for green certificates. Innovation targets in the energy industry Unlike in the other Nordic countries, risk capital has a strong presence in the Norwegian energy sector. It is also growing slowly everywhere in the region. The annual revenue of the energy technology sector in 2008 was estimated at 26 billion euros – 6.2% of all income in the industry. Also interesting is the fact that while Norway plays the leading role in the energy systems of first generation (silicon-based) camera elements, for example, Denmark has taken out more patents on second generation solar system technology. The Danes are also considered to be keenest when it comes to wind energy patents – a field to which the country has been consistently contributing since the 1990s and in which the highest rate of energy per capita in the world is produced. At the same time, it is the Norwegians who are behind the world's biggest open sea wind turbine. The Nordic countries have as much as a 30% market share in the global wind turbine market; mostly due to the enormous advances in the Danish wind turbine industry. Wind produces 17% of Denmark's electricity, compared to ca. 1% in the other Nordic countries. Denmark, Sweden and Finland are all very active in registering patents for second generation biofuels. Norway and Iceland are leaders in the use of water and geothermal energy. Bioenergy plays a key role in Denmark, Sweden and Finland, in the latter of which it accounts for 20% of energy production. Exports of energy technology from Norway, Denmark, Sweden and Finland in 2009 were valued at 140 billion Danish kroner, the majority of which came from Sweden and Denmark. Energy technology accounted for 5% of all Nordic exports for the year. The October 2009 report on Nordic Energy Research formed the basis for this overview. |
The many faces of Nordic energy in 2010
|
Thankfully, the many years of experience the region has in working together means that this diversity is able to applied for the benefit of all. Cooperation in the energy sector, which was officially institutionalised in 1985 (as Nordic Energy Research), does not only comprise nuclear energy: Nord Pool was launched as the world's first electricity exchange between Norway, Denmark, Sweden and Finland in 2000, with 60% of the region's electricity currently being traded on it. |