Sweden CHP/DH policy measures

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1 Sweden CHP/DH policy measures In Sweden have the usage of renewable fuels been increasing during the last thirty years. There are several reasons for that. During the last twenty years have there been different governmental support for plant using other fuels than fossil fuels. There has also been support for modification and extension of district heat systems to decrease the CO 2 -emissions from combustion. The first support was in 1983 to plant owner that built new boilers or modified boilers so that peat could be used as fuel and substitute fossil fuels. Most of the boilers build was multi fuel boilers. The amount of peat that was fired was limited, the main fuel in the boilers have been different types of biomass. Next support came in 1991 and was a support for new CHP plants fuelled with biomass. The latest support was in The support was also for CHP-plants fuelled with biomass. Each support has been limited in time. The normal support has been less than 25 %. The different supports have had an impact on the usage of biomass as fuel. The total CHP plants built with support are approximately 54. The total installed effect from the two latest support programmes is 485MW power and MW heat or GWh/year power and GWh/year heat Between 1988 until 1998 there was a found named Energiteknikfonden (SFS 1988:805) for support of development and demonstration of new energy techniques. Year 1998 was the regulation for the support changed and renamed to Energiteknikbidraget (SFS 1998:654). Investments aid to biomass fuelled plants During the past there have been three investment aid programs for support of biomassfired plants in Sweden. The three supports are: 1. Support for peat fired plants. Support was founded in 1993 and was available in one year. Support could be given to CHP, DH and backpressure plants. 2. Support for CHP plants fired with renewable. Support available during 1992 to Support for CHP plants fired with renewable. Support available from 1998 to Support for peat fired plants The support was available during The support was available for plants that could be used for peat firing. The amount of support was thousand Swedish kronor. 1

2 The support could be up to 25 % of the cost for the plant. About 50 plants got support for building of new boilers. Most of the boilers built with this support were boilers for district heating plants. Most of the plants were built for different fuels and today are mostly different wood fuels used in the boilers. Investments aid for CHP from 1991 The support for a plant was up to kronor/kw installed power capacity and max 25 % of the investment. Under the investment aid of 1991 was 44 different CHP plants built. The plants was of type landfill gas plants, biomass fuelled plants and plants for combustion of gas from sewage treatments plants. The size of plants varied from 108 kw th to 188 MW th. Plants with an installed power effect of 321 MW and heat effect of 730 MW was installed with in this program for investments aid. The power production from the plants are GWh of power and GWh of heat. Number of plants 44 Total installed power 321 (MW) Total installed heat (MW) 730 Total production power yearly (GWh) Total production heat (GWh) Total cost for investments including aid. (thousand Investment aid. (thousand Average cost per kw installed power. (kr/kwh) Table 1. Impact from the 1991 years investment aid for CHP in Sweden. (Source internal Swedish Energy authorities) Investments aid for CHP from 1998 The support of 1998 was not so favourable as the support 1991 the support was restricted to kronor/kwh and less than 25 % of the investment. The investment aid was regulated in SFS 1998:22. Number of plants 10 Total installed power 164 (MW) Total installed heat (MW) Total production power 882 yearly (GWh) 2

3 Total production heat (GWh) Total cost for investments including aid. (thousand Investment aid. (thousand Average cost per kw installed power. (kr/kwh) Table 2. Impact from the 1998 years investment aid for biomass fuelled CHP in Sweden. (Source internal Swedish Energy authorities) D3a&i Impact of earlier investment aid There have always been applications for more support than the available support. The number of plants built with out of support has been limited. The question is if the different supports have had some impact on the usage of biomass as fuel in Sweden. The change of biomass usage as fuel is an indicator of the impact of the support. Figure 1 shows the yearly change in usage of biomass during the period 1970 until year Change in yearly usage of biomass (TWh) (Year) Figure 1. Yearly change in usage of biomass as fuel. In 1983 there are an increase of usage of biomass as fuel. The increase of biomass usage was continuing until The increase during the three first years is directly derived to the investment aid of During the first year were a number of plants built and the usage of biomass was increased rapidly. After the plants was built increased growth of usage. The increase after 1985 depends partly on that the boiler owners learned how to run the boilers. 3

4 The next period with increase of usage of biomass fuels was between 1991 and The fastest increase was during the period 1994 to 1997 when most of the bigger plants that got support were taken in operation. Year 2000 there was a small decrease in the usage of biomass fuels. From year 2001 there again are an increasing usage of biomass fuels. The increase of usage of biomass as fuel depends on the support from In year 2003 is the last plants taken in operation that was built with the 1998 years support. After year 2003 will the increase of usage of bio fuels depend on other reasons than investment aid. The status for support to day, January 2004 At the moment there is no general investment aid available at the moment. In the report Electrical production from renewable- economical conditions and market mechanisms carried out in co-operation between a number ministries different supports are discussed. In Since 1 st of May 2003 there is a system with green certificates in operation in Sweden and regulated by law. There is very little information about experience at the moment. The green certificates should be a support for renewable. There are possibilities to get support from the Swedish Energy Agency for projects demonstrating innovative new energy technologies. Experiences of investment aid As a result of the governmental investment aid programs during the last twenty years have about 110 plants for district heating and CHP been built. There have not been any problems to find plants to support. Year of manufactoring for Swedish boilers (Number) (Year) Figure 2. Number of boilers, larger than 10 MW, that have been installed each year since 1930 that still are in operation. 4

5 Figure 2 shows the number of boilers that was taken in operation each year since 1930 that still are in operation. Since there are no complete registers over existing boiler there could be some boiler that are registered twice and some that do not are registered. Anyhow give the Figure 2 a god idée of the age of Swedish boiler. All boilers for all fuels are included as well industrial boilers as district heating and power boilers. Older boilers have in many cases been refurbished and it is not many parts that are from manufacturing year. The first district heating system, in Sweden, started in 1948 in the town Karlstad. During the period from 1949 and the two decades after that was the district heating expanded in Sweden and the largest Swedish district heating nets was established. During the period was a lot of boilers build, still are many of these boilers in operation. Most of the boilers built in during the 1950 th, 1960 th and 1970 th are oilfired. Boilers built before 1949 are mostly industrial or power plant boilers. In Figure 2 it is possible to se the se de result of the financial aid for boiler. The years after 1983, 1991 and 1998 have there been an increase in building of new boilers compared to the last years before the investment aid. The number of boilers built each year during the last twenty years have been few but the number have increased when there have been aid. 5