Skip to content

Smart energy usage must be rewarded

Surely nobody has missed the news of the high prices for electricity over the past week. How can it have come to this? Couldn’t we have seen this coming?? At 4pm on Monday, the price of electricity before taxes and charges in the south of Sweden was SEK 6.49 per kWh. Yet another new record!

We are in a special situation right now that someone has called a “perfect storm”. A number of different factors have coincided such as a relative lack of wind, production restrictions in hydropower due to icing over, limited transmission capacity between the north and south, plus extremely cold weather across the whole of Sweden. The high price of natural gas and emission rights has also contributed to this.

This situation puts the focus on both power needs [kW] and energy efficiency [savings per kWh]. Do we really use electrical energy in the best ways? Are we sufficiently energy efficient? If we compare Sweden with the rest of the EU, we are no better than 16th when it comes to energy efficiency. In other words, there is a great deal to do in this area.

Why has it come to this? On many occasions, various potential projects aimed at possible energy efficiency improvements fall by the wayside because it is difficult to demonstrate that they are financially worthwhile. When doing the calculations before a decision is made, we base these on historically low energy prices. It is probably time for a rethink. We need to include the savings from reduced energy requirements in the calculations as well. Smart energy usage must be rewarded.

How then energy needs and energy efficiency improvements go hand in hand? One common result of improved energy efficiency is that the maximum power requirement will be reduced. One important development factor for future energy systems would also be to incorporate energy storage and flexibility of usage to enable us to better manage a similar situation in the future.

Modern electric vehicles have a substantial storage capacity of 80 – 100 kWh for example, our homes also have a significant inbuilt flexibility via their thermal inertia. (It can take several hours for the temperature to drop by one degree indoors if the heating is turned off.) However, it can also be a case of us having to adapt to the new circumstances to a greater extent. Wear a thicker top during a cold snap!

Hopefully, this week’s electricity price shock will lead to some new strategies when it comes to improving energy efficiency and smarter electricity usage with a better understanding of how important all this is for the energy balance. KTH has done quite a lot of research into energy storage, energy efficiency improvements, but more needs to be done.

Hopefully, the Swedish Energy Agency and other grant providers will invest in more research into smart and efficient use of energy as a key strategy for managing the power balance in the future.