Norway and Sweden: end of admission of new installations to elcertificates

The joint Norwegian-Swedish elcertificate market has stopped admitting new installations: the commissioning deadline expired at the end of 2021. The system did not pick technology winners, so biogas and biomass competed in it with hydro and wind.

How the system works

An elcertificate is a certificate that a renewable energy producer receives for every MWh generated. Electricity suppliers are obliged to purchase a specified number of certificates. The producer's income is the market price of electricity plus the price of the certificate. According to the Swedish Energy Agency, the Swedish system has operated since 2003, the joint market with Norway since 2012, and it will end in 2035.

The end-of-2021 deadline

According to Statnett, installations that began operating by the end of 2021 were entitled to elcertificates, subject to approval by NVE (the Norwegian regulator). Swedish rules provided that installations, as well as permanent production increases or rebuilds, commissioned after the end of 2021 can no longer receive certificates. The Swedish agency states that the end date of the system was brought forward from 2045 to 2035.

What about biogas

The system covers all renewable sources, including bioenergy, so there were no separate rates for biogas. After 2021, new biogas projects in Norway and Sweden cannot count on elcertificates; any support for them relies on other instruments, which this entry does not discuss.

Why this matters for comparisons

Norway and Sweden show a model in which there is no separate tariff for biogas and profitability is determined by the sum of the electricity price and the certificate price. Such a system has advantages: it does not require administrative rate-setting, and the cost is borne by consumers through the obligation to purchase certificates. The drawback is the volatility of certificate prices, which is hard to predict over the long term. Closing the intake of new installations means that those who made it in time continue to benefit from support, while new investors must look for other sources. For comparison, we describe the Polish systems in the law category. It is also worth remembering that the final revenue of a biogas plant using elcertificates was determined by two independent markets: the electricity price and the certificate price, and each of them moved at a different rhythm.