Future development trends in electricity demand

The future electricity demand and demand trends in Finland and in the Nordic countries (excluding Iceland) are the main focus of this report. The electricity demand per capita is high on a European and even on a global scale in Finland, Sweden and Norway. One reason is the high share of electric heating combined with a cold climate; another reason is the relatively low price level of electricity which has led to extensive electricity intensive industry. The estimated Nordic business as usual (BAU) demand for year 2020 is 435 TWh and for year 2030 454 TWh. EU's recent policy decisions regarding increased use of renewables, greenhouse gas emission reductions and improved energy efficiency will have an impact on the electricity system. The basic demand is expected to decrease compared to the BAU scenario. The future trends do not only affect annual consumption, but also the load curves and system peak load behaviours. Using consumer type load models and sectorwise annual energy estimates, we model the Nordic load curves for each country for the years 2020 and 2030. EU 20-20-20 policies will change how electricity is used. The authors of this report see industrial electricity demand, electric heating and heat pumps, and electric vehicles as the most important individual factors that may affect electricity demand in the future, and even increase it considerably. The impacts of large scale penetration of the latter two are further analysed with special regard to effect on system peak load. The analysis was done using what-if cases. The future of oil heating is under the spotlight especially in Finland according to the long-term climate and energy strategy of the Ministry of Employment and the Economy. If 200 000 of the oil heated detached houses are converted to heat pumps, then the electricity consumption would rise with more than 2 TWh. At the same time the peak load will rise with 1100 MW. On the other hand, if a similar chunk of direct electric heated houses get heat pumps, it will more than compensate for the rise in consumption. But not for the rise in peak load as there will still remain a net increase of 700 MW. The deployment of electric vehicles (EV) and their effect on the electricity power system was studied. The results indicate that a small amount of EVs (5% to 10% market share) will increase electricity demand by a negligible amount, less than 0.5-1 % in Finland. If half of all personal vehicles were EVs, a realistic possibility by 2030, the electricity consumption would rise in Finland by 3 TWh and in the Nordic countries by 15 TWh. However, it will not require any extraordinary changes to the system peak load management if smart distribution network charging is selected as the preferred charging method. Our results show an increase in the system peak load of 1000 MW on the Nordic level. Large scale penetration of both heat pumps and electric vehicles on a Nordic level are studied with two case studies, case A being a worst case scenario with regard to load impact and case B a more realistic alternative. In case B also electric heated houses get heat pumps, not only oil heated houses as in case A. Both cases show a substantial (3.000-4.000 MW) peak load increase at -25°C, whereas peak load increase is quite small for case B at -10°C. A simultaneous cold spell in the Nordic countries is in our opinion better described by -10°C than by -25°C, thus EVs and heat pumps might not affect the peak capacity requirements in the Nordic countries as adversely as beforehand was anticipated. Considering all demand issues presented in this report, it is clear that electricity is a high value source of energy offering possibilities to overall energy savings and an increased share of renewables. This will further boost the electrification of the society.