Runar Brännlund believes that each electricity technology should carry its full cost. Subsidies have a tendency to provide incentives whether there is a demand for electricity or not. This was discussed at Almedalen in July.
The deputy Research Director of CERE, Runar Brännlund, was at Almedalen and participated in a debate regarding the future electricity market, and how it will develop given the targets of zero nuclear energy and 100% renewables. The main issue discussed in the meeting was challenges of phasing out nuclear power and replacing it with renewable electricity production, such as wind and solar energy. The challenges concern robustness and electricity security, price level and price volatility. A key question was whether the current market design, which can be described as an energy-only market, can handle these challenges, or if we also need markets for capacity.
Runar’s role at the meeting was to give a very short presentation of his views about these issues, and then participate in panel debate with politicians and representatives from the electricity sector. His view about solar electricity, and other technologies, is that each one of them should carry its full cost, and that subsidies to any particular technology should be avoided. For him, temporary subsidies may be motivated due to learning-by-doing and technological spill overs. But for a small country like Sweden it is not likely that subsidies for generating solar or wind power is a good idea. Runar said, with current subsidy schemes, such as the green electricity certificates, we tend to provide incentives for electricity production independent of whether there is demand for electricity or not, for example, owners of solar power receive a “premium” to produce electricity in the summer when demand is low.
The discussion panel in this event included Bo Normark from Vägval el, Leif Johansson, Björn O. Nilsson, Karin Byman and Jan Nordling all from IVA. Other participants were Ulla Sandborgh from Svenska Kraftnät, Johan Svenningsson (Uniper), Penilla Gunther (KD), Ingmar Nilsson (S), Maria Sunér Fleming (Svenskt Näringsliv) and Maria Sandqvist (Forum för smarta elnät).