* Nordic power surplus to be 20-50 TWh in 2020
* Norway, Sweden to build 10 GW of wind, hydro, biomass
By Nerijus Adomaitis
OSLO, Nov 12 The Nordic region's investment in
renewable energy will give it a large surplus of power to export
by 2020, pushing down regional electricity prices and raising
the need for new export links, Norwegian energy firm Statkraft
said on Monday.
Denmark, Finland, Norway and Sweden have linked their power
markets into one electricity region, meaning all will see the
benefit of Norway and Sweden's plan to add 26.4 terawatt-hours
(TWh) of wind, hydro and biomass generation by 2020.
That would be the equivalent of around 8-10 gigawatt (GW) -
or ten standard-sized gas and coal-fired power stations - of new
installed wind, hydro and biomass power generation capacity.
According to Steinar Bysveen, executive vice president of
Norwegian state-owned Statkraft, consumption over the same
period will be flat or even fall thanks to parallel efforts to
save energy, leaving the Nordic region with a hefty surplus.
"We will have a surplus in the Nordic countries in a range
from 20 TWh to 50 TWh (per year) in 2020," Bysveen said.
"With that surplus, we will have a huge need for exporting
our renewable energy."
Norway already plans to lay a new 1,400 megawatt (MW)
capacity cable to Germany by 2018 and also wants to build the
world's longest subsea power cable of a similar capacity to
Britain by 2020. That would largely cover the
surplus estimated by Statkraft but the more lines out of
Scandinavia it has, the more it will be able to pick and choose
where the power is sold.
The UK and Germany would benefit from having access to
Norway's flexible hydro power capacity as it would balance
volatile wind and solar power generation.
"There is no doubt in my mind that the volatility in Europe
will increase even after 2020... I think, it would be beneficial
both for Norway and the European societies to develop even more
cables after 2020," Bysveen said.
"It's not a question of how many cables are needed, but how
many cables we can get on track."
If one adds Scandinavia's large existing hydro plants to its
new sources of renewable power generation, Statkraft is Europe's
largest producer of green energy as Norway gets about 95 percent
of its electricity from hydro generators.
EFFECT ON PRICES
Statkraft said that Nordic power prices would fall as a
result of the surplus.
"Prices in Norway and the Nordic countries will definitely
go down because we will get a surplus," Bysveen said.
Some Nordic market participants, however, believe that more
interconnections to Europe will lead to higher prices in the
Bysveen disagrees. "My conviction is that the effect (from
more interconnections) will be marginal, while the total
transformation from fossils to renewables will lead to the
Nordic prices to go down."
The Scandinavian countries, which rely on hydro power for
more than 50 percent of their electricity generation, saw a
power deficit of 18.7 TWh in 2010 when dry and cold weather
depleted water reservoirs, data from the Nordic power exchange
Nord Pool Spot showed.
The deficit narrowed to 4 TWh in 2011, when wet weather
helped to restore supplies.
(Editing by Henning Gloystein and Patrick Graham)