The BFD | It really was a stupid move

Apart from the difference that New Zealand is not shutting down any nuclear reactors, just oil and gas power plants, the similarities in problems and likely outcomes to Sweden’s are striking.

Electricity should, ideally, be generated as close as possible to where it is consumed. In New Zealand, a major bottleneck is the Cook Strait cable capacity. If Tiwai shuts down, the problem is getting that ‘spare’ electricity from Manapouri up to Auckland to charge all the electric vehicles.

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Global trade wars and weakening export markets are not the only potential dampers on Sweden’s growth. There’s also a homegrown problem: a lack of power capacity.

The dire situation stems from the closing of the nation’s oldest reactors and a shift to wind at a time when the grid is already struggling to keep up with demand in major cities. The shortage, which impacts the nation’s main urban areas, is threatening everything from the rollout of a 5G network in the capital to investments in giant data halls and new subway lines. It could even derail Stockholm’s bid for the 2026 Winter Olympics.

It’s a stark change from the decades of cheap, surplus electricity that propelled the Nordic region’s biggest economy into one of the richest and most industrialized nations in the world. Now, electricity supplies in urban areas can’t keep up and that could exacerbate a slowdown already impacted by global uncertainty and Brexit.

“Citizens and companies are worried, irritated and even angry,” said Jonas Kamleh, a strategist for the City of Malmo, the nation’s third biggest. “How could this situation arise in the engineering nation of Sweden?”

The answer is a very ambitious green agenda.

Sweden is halfway through a plan to replace the output from four reactors in the industrial south with thousands of wind turbines in the north. But grid connections, some dating back to the 1950s, aren’t up to scratch so the power isn’t shipped to where it’s really needed. And to make matters worse, city demand is surging at a faster-than-expected pace because of the electrification of everything from transport to heating. […]

The abundance of carbon-free power from hydro, nuclear and wind has attracted billions of dollars in the past decade from some of the world’s biggest companies from Amazon.com Inc. to Facebook Inc. and Microsoft Corp. With the major urban areas out of bounds, it will be harder to attract the same level of investment in the future. […]

Stockholm shouldn’t expect any new cables that can handle an increased load for at least another decade, according to local grid operator Ellevio AB. That means the company will have to start rejecting new big users as early as this autumn.

The lack of power threatens everything from expanding the subway network to new highways and residential areas. The Olympic bid submitted in January included new stadiums and housing for the athletes north of the city. […]

Neither the Olympics nor a new mobile network are included in the latest grid forecasts. The vast amount of data generated by 5G use from self-driving vehicles to domestic appliances to sensors for roads and railways will need to be supported by data centers that would further increase demand in the city of about two million people.

“We have reached a point where we no longer can connect all the changes the society is facing,” said Henrik Bergstrom, Ellevio’s head of public affairs. “It is not up to us to decide who will be denied access to the grid, but without local power generation and grid investments we will have problems.” […]

“It’s a little bit exaggerated because many companies ask for more power in many different places,” Energy Minister Anders Ygeman said. “But of course we need to improve the transmission capacity between north and south, and we need to bring about more power production closer to the consumers.”

For the angry folk of Malmo, Ygeman’s comments offer little hope. The city was already on the brink of blackouts last winter. And there will be even less power in the future if EON SE goes ahead and shuts a local gas plant if higher environmental taxes are introduced as planned in August.