Additional Transmission Capacity Proposed to Reduce Price Dispersion in the Swedish Electricity Market

A new report recommends that the state-owned Swedish National Transmission Company (Svenska Kraftnät) is given the task to guarantee a minimum transmission capacity of 4 000 MW to the southernmost region and to initiate tests with auctions of Contracts for Differences.

The Swedish power market was split into four regional markets on the Nord Pool Spot power exchange. Limited transmission capacity resulted in significantly higher prices in the southernmost region. The Ministry of Enterprise, Energy and Communications hired Björn Hagman to analyze possible actions which could reduce the price difference between different regions and he delivered his report on January 9. The report recommends that the state-owned Swedish National Transmission Company is given the task to guarantee a minimum transmission capacity of 4 000 MW to the southernmost region and to initiate tests with auctions of Contracts for Differences.

http://www.regeringen.se/content/1/c6/20/68/15/7bcd1fc4.pdf

Jonas Andreasson

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