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Major investments essential to secure electrification

Large parts of the wind power expansion in Sweden are being funded by a new kind of stakeholder. A trend that is expected to grow stronger as large global capital flows seek green net zero investments.
– “We’re very much in a position to accomplish something that the rest of the world can benefit from,” says Jonas Bergqvist, Focus Area Manager Energy Systems of the Future at RISE.

Tech and logistics giant Amazon is expected to commission its third wind farm investment in Sweden in the northern county of Västernorrland in 2022. Wind and solar power developer OX2 has handed over completed wind farms to IKEA and Google — giants that are securing access to renewable electricity through ownership. State and municipal companies are losing market shares across the board as other capital seeks promising investments.

– “However, exactly who owns electricity production facilities is of lesser importance. More important is where they are built, that production is close to end users. This is because we don’t have time to expand the transmission infrastructure in the short to medium term. This is an important consideration – you can’t say no because then there won’t be anything for you,” says Jonas Bergqvist.

Major investments required

Guestimates project investment needs in the region of SEK 1,000 billion to complete the energy transition required for net zero greenhouse gas emissions by 2045. Internationally, investment needs are on corresponding levels.

In his annual letter to CEOs, Larry Fink, CEO of the world’s largest asset management company Blackrock, speaks of an “unprecedented amount of capital looking for new ideas”. He also writes, “The next 1,000 unicorns won’t be search engines or social media companies, they’ll be sustainable, scalable innovators – startups that help the world decarbonize and make the energy transition affordable for all consumers”.

– “We need to position ourselves favourably for investments,” says Jonas Bergqvist.

Initiative to drive energy transition

Jonas Bergqvist is part of the RISE team behind Energiklivet, an initiative pursued together with energy industry stakeholders to speed and drive innovation in the energy transition. In addition to complex technology and systems, it is very much about ensuring flexible regulatory systems and viable market models.

– “We need to try a lot and experiment a great deal. Sweden’s energy innovation portfolio needs to double or triple in size.”

– “I can envision Energiklivet achieving similar feats in this field to what Sweden’s home PC reform did for digitalisation here. We digitalised earlier than the rest of the world, and we’re going to do the same within electrification.”

We need to water like crazy to get things to grow

The technology already exists

Jonas Bergqvist says that a large share of the electrification process could be achieved with existing technology. Then there are promising technologies such as those for carbon capture and energy storage that can not only have an impact in local energy systems, but also help to replace fossil-based systems more quickly.

– “We need to water like crazy to get things to grow. Set up demo and test projects, get region x to provide a battery for a project, and scale things up within storage. Invest in trying new Swedish solutions, so that we put our innovation into practice.”

In addition to the investments that can be made within the Energiklivet initiative, RISE is also working with various stakeholders to boost climate efforts. Companies and society are being helped to understand and act on the major challenges they face by means of analyses, advice, road maps and projects. To exemplify, Jonas Bergqvist mentions the work on energy plans in Region Västra Götaland and Region Skåne.

– “We do a great deal of policy work for several municipalities and regions. Translating their environmental goals into concrete terms, ensuring that they have the right plans and make the right decisions. We help them to break down their plans to enable them to become fossil free by a certain year, to make their progress both measurable and feasible.”