Sweden will only reconsider building an interconnector with Germany if the latter reforms its electricity market to make it less reliant on imports.
Speaking to the Financial Times, Swedish energy minister Ebba Busch explained that Germany must split its electricity market into bidding zones to bring overall prices lower. Only then would Sweden move forward with the 700-MW Hansa PowerBridge between Northern Germany and Southern Sweden.
Busch’s statement comes on the heels of a warning from Norway that it would cut its own interconnectors with Germany and other European countries due to excessive exports that have pushed domestic prices to unacceptable levels. The situation is the same for Sweden, hence its decision to shelve the Hansa PowerBridge project for the time being.
There is also a problem with wind and solar, which do not generate electricity consistently. This has led to periods of overproduction followed by periods of almost no production—a situation that has significantly increased price volatility on European power markets, causing wild swings from below zero to much higher than average in a matter of days.
Busch also criticized Germany for shutting down its nuclear power plants and refusing to support nuclear power on the EU level. Sweden’s previous government was strongly anti-nuclear but the government that Busch is a member of has reversed this stance.
In comments on the Norwegian concern about electricity exports, the Swedish energy minister told the FT that it was “a sad moment for Europe when an open, progressive country that likes being part of the rest of the world is signaling that we might not want to be part of this interconnected energy system . . . it’s a strong signal to be taken seriously”.
The warning signs of the EU’s electricity market instability come as the bloc’s executive leadership commits to building ever more interconnectors between member states claiming this would enhance everyone’s energy security.
By Irina Slav for Oilprice.com
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