STOCKHOLM - Sweden's energy minister said yesterday he would demand that all energy suppliers sell green certificates together with electricity from 2003 to help promote a shift to renewable energy sources.
He added that the market in trading such certificates was likely to become pan-Scandinavian. "This system will force producers to invest in renewable energy," Industry and Energy Minister Bjorn Rosengren told Reuters.
"It will become a separate market, and I would guess that other countries would like to join," he said, adding that he saw Norway and Denmark as likely candidates. Both countries recently decided to set up domestic trading systems.
Green certificates are issued free to producers of renewable energy such as wind, solar and bio-energy who can them sell them in the marketplace.
The certificates allow the buyer to emit carbon dioxide (CO2), widely seen as a contributor to global warming, and therefore promote renewable energy and penalise producers of electricity from fossil fuels like oil and coal.
Rosengren said the Swedish initiative came on the back of an energy white paper whereby the government aims to increase Sweden's renewable energy production by 10 terawatt hours (TWh) by 2010, rising to 15 TWh by 2012 if the system proves a success.
"We hope that after eight years the market will represent 10 terawatt hours, which is about 7-8 percent of our total generation of some 150 terawatts a year," he said.
Rosengren said the market would push down prices on the emission quotas of greenhouse gases and ensure that the building of new renewable energy capacity came with an acceptable price tag.
"But consumers are clearly the ones who will have to pay for it," Rosengren said. He estimated that a typical house owner would see an increase of about 150 Swedish crowns ($15.08) in the annual power bill.
The quotas are estimated to cost between 0.06-0.20 crowns per megawatt hour of electricity for the first two years from 2003 before stabilising just below 0.20 crowns.
That assumes that the scheme will spur invstments into new renewable energy in line with the government's estimated growth rate at 10 TWh by 2010. Power-intensive industry will be exempt from the green certificates scheme.:
