Sweden Pressures Germany to Reform Power Market

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Germany,Electricity Market,Interconnector

Sweden halted construction of a power interconnector with Germany due to concerns about Germany's electricity market volatility and reliance on imports.

Sweden will only reconsider building an interconnector with Germany if the latter reforms its electricity market to make it less reliant on imports. Speaking to the Financial Times, Swedish energy minister Ebba Busch explained that Germany must split its electricity market into bidding zones to bring overall prices lower. Only then would Sweden move forward with the 700-MW Hansa PowerBridge between Northern Germany and Southern Sweden.

This has led to periods of overproduction followed by periods of almost no production—a situation that has significantly increased price volatility on European power markets, causing wild swings from below zero to much higher than average in a matter of days. Busch also criticized Germany for shutting down its nuclear power plants and refusing to support nuclear power on the EU level.

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