Response to interpellation 2023/24:174 on increased efforts for energy efficiency
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
The debate concerns increased efforts for energy efficiency. S argues that Sweden needs an additional 60 terawatt-hours by 2030 and that efficiency is an important tool to free up capacity 1. S proposes that the rotavdrag (rotational deduction) should be directed entirely towards energy efficiency with a subsidy rate of 50 percent 1, reintroduce support for multi-family housing 1, and that the government has stopped the work on a certificate system 2. S believes it would have been reasonable to let the investigator complete their entire work and that a higher subsidy rate would have helped households and lowered prices. KD argues that the government is already taking powerful measures 3. KD emphasizes that energy efficiency is a firm conviction 3. KD argues that white certificates should not be introduced 4 and that the rotavdrag can be used for energy efficiency 4. KD looks forward to implementing the EU directives 5 and plans to present a new proposition 5.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! Fredrik Olovsson has asked me whether I intend to take further measures to reach the energy efficiency goal decided by the Riksdag and, if so, what measures can be expected to be taken.
Sweden's national goal for energy efficiency of 50 percent more efficient energy use by 2030 compared to 2005 is measured as energy intensity, that is, the amount of supplied energy divided by GDP. Both a reduced amount of supplied energy and a positive development of GDP thus imply a lower energy intensity, and both factors contribute to the goal.
In recent years, major events have occurred in our global environment, such as Russia's invasion of Ukraine with the subsequent energy crisis and high energy prices. Right now, we are also seeing a weaker GDP development, largely because households are being pressured by high inflation and high interest rates. The forecasts for future GDP development are uncertain. The high energy prices in recent years have led to energy savings, both through temporary reductions in energy use and through increased investments in more durable energy efficiency measures.
An extensive electrification of primarily the industry and the transport system is underway in order to both meet the climate goals and strengthen the long-term competitiveness for Sweden's business sector. The electrification is expected to result in an increased energy use within the industry, but a decreased energy use within the transport sector due to the high efficiency of electric motors. The net effect will, however, be a significantly increased energy use over the coming 20 years.
To maintain and strengthen Sweden's competitiveness and welfare, access to, and thus the use of, fossil-free electricity at competitive prices needs to be promoted. We also obviously need to use energy more efficiently in the energy system, Madam Speaker. Between 2023 and 2025, the government is investing approximately 1.2 billion SEK in energy efficiency measures, primarily to reduce the vulnerability of small house owners during high electricity and gas prices. The initiative includes both an investment grant and information efforts to increase awareness of the importance of improving energy efficiency.
Within the framework of Fit for 55, we have received a revision of the energy efficiency directive. It must be implemented into Swedish legislation by October 11, 2025, at the latest. The Government is now analyzing the proposals for legislative amendments and other measures that may be necessary for implementation. Measures to implement the EU's energy efficiency legislation will, of course, also affect the development towards the national energy efficiency goal.
Fredrik Olovsson (S)
Madam Speaker! Thank you very much, Minister, for the answer to my interpellation!
Sweden is undeniably facing a comprehensive electrification. It is exactly as the Minister says. Part of the electrification also leads to increased energy efficiency. But just because the electricity system needs to grow and we want it to grow, one cannot also ignore the need to streamline the use in that area. It is actually the opposite.
Sweden has had the same electricity consumption for decades, approximately 140 terawatt-hours per year, despite the fact that during the same long period we have had a strongly increasing population and an industry that nevertheless produces more today. That it correlates is, of course, due to the fact that one has wanted to streamline processes and use electricity and other energy more efficiently.
In the short term, the government is somewhat reluctant - or rather, one has an inability - to add much more electricity to the system. We have repeatedly spoken about it in this chamber. We see that we would need an additional 60 terawatt-hours by 2030.
But even if one does not succeed, efficiency will instead be an important tool to make it possible for more actors to enter the system. The one who has an opportunity to increase efficiency frees up capacity for the one who needs more in another area.
We Social Democrats have proposed many interventions and measures that could increase the efficiency of electricity use. One is to use the tax deduction for repairs and renovations more directedly, that is, to increase the subsidy rate to 50 percent but to target it entirely towards energy efficiency.
A very good point with that is that the person who wants to luxury-renovate their house can bear that themselves, because it does not create value for anyone other than that person themselves, while the person who invests resources to save, for example, on their electricity consumption contributes to lowering the electricity price for everyone. It does not cost the state more to do it in that way. On the contrary, it would improve for the whole society to support those households who want to make an effort both for themselves and for others.
The government parties have also precisely designed their policy so that multi-family dwellings do not receive a share of the money for energy efficiency. There, not least the Christian Democrats have repeatedly removed support that previously existed.
We think it would be high time to introduce such support again. Even this sector can contribute to reducing its energy use. The state crowns that are spent on it would also benefit the entire society.
Furthermore, more should be encouraged to do as, for example, ÖBO, the municipal utility in Örebro. It has created conditions to manage its system so that it can relieve the national power grid and contribute to frequency control for the benefit of many.
These are some tips from the opposition parties. There are a couple of three good proposals that could also be used by the government. More measures are required. Reformulating the goal may be necessary, not least as the EU continues its work.
But we know one thing: More measures will be needed. The question is: When will the government's actually arrive?
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! I mean that we already have quite powerful measures in the budget bill that will come into effect in earnest at the turn of the year, which I have previously accounted for.
Furthermore, we have what we call the small house grant. During the winter of 2022/23, energy prices were exceptionally high, as we all know. Many Swedish households had significantly higher costs to heat their homes than before. In order to promote energy efficiency and reduce households' vulnerability to the high energy prices, we chose to make a clear prioritization in the budget of 1.2 billion for a new grant for energy efficiency in small houses. We believe that this has good conditions to achieve quite substantial effects for many households.
The contribution is aimed at detached houses with direct electricity or gas as a heating method; it is they who have been the most vulnerable. It should, of course, be seen as a complement to the historically large electricity price support that was implemented to provide short-term relief. This, instead, will be a long-term measure to increase energy efficiency for our households.
We would like to see more of those types of measures, but it is a matter of designing them correctly so that they also, from a perspective of energy efficiency, become effective contributions that truly reach their target.
The second part that I want to highlight in the budget bill concerns energy planning in general. Also for this, we have added additional funds in the budget bill for 2024.
We shall try to find a long-term model, Madam Speaker, for the coming years that allows us to plan the energy supply better, not least at a regional level. It is about creating incentives for the regions to really do this in a good way, but above all, it is about finding models that are viable. It is an important part. This is not counted as classic energy efficiency, but we are making the way we plan to distribute the electricity we already have more efficient.
Not least, I want to emphasize that we are now in a situation where we know that our electricity consumption will increase significantly. It is our best way to be able to reach our high-set climate goals and at the same time safeguard our growth opportunities, job creation, and our strong welfare. We can make that equation work by electrifying our heavy industry and our transport sector. Then more electricity will be needed, and not less electricity.
But that must not prevent us from improving energy efficiency where we can, and that is also the government's very firm view.
Fredrik Olovsson (S)
Madam Speaker! We welcome the initiatives that the government is making in the budget regarding energy planning. We believe that it will be necessary when the system is to increase as strongly as we want it to do, because it would mean that we get all the jobs and investments to Sweden that we have good conditions to receive.
When it comes to small-house owners, there is no new support in this budget, as it has existed in previous years. We also think it is an excellent support to introduce precisely to reach households that have a great need to transition quickly to manage their household finances because they are so vulnerable to high electricity prices.
However, it does not mean that one should not use other measures more effectively. This applies, for example, to the rotavdrag (deduction for energy-saving improvements), which is not particularly effective today. It is not targeted at this sector, even though it is of course used to make measures that lower households' energy costs. But by both increasing the subsidy rate and redirecting the support specifically to measures that can lower, for example, electricity consumption, the individual household would get an even greater opportunity to lower its costs. We also know that the one who uses less electricity lowers the cost for everyone else for the electricity. If we save some percentage, prices drop by more than that.
This is, therefore, an important measure that the government could introduce without it costing more money. It is rather a question of distribution than of the amount of resources deployed.
I also raised the issue of multi-family housing. There, support has been repeatedly introduced by us and removed by the bourgeois parties. The question is how the Minister justifies it in such a situation, when more should contribute more to streamlining.
The previous Social Democratic government tasked an investigator in 2021 to develop a certificate system for energy efficiency. The purpose was to achieve a market-based and cost-effective steering instrument that could increase the rate of energy efficiency in Sweden and contribute to the energy policy goals.
The investigation was discontinued a year ago by Ebba Busch and the government. We naturally believe that this work should have been completed. This is a system that exists in other countries, where it works, and which could also be used in Sweden. It is both market-based and cost-effective – words that should make the Minister happy and interested. The question is why this system and the opportunity that exists to add another tool to the toolbox was simply stopped. I believe rather that we need more proposals than fewer, and I have now mentioned a number of such.
I hope that this is something the Minister takes with them so that the work is not just about a new goal formulation. Goals are important, but we know that measures will be needed already now. Much can be done before 2026, which will likely be the year when this can start to apply given the EU work that is ongoing.
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! It is not every day that one receives feedback and requests that the Minister should feel happy and interested, but it is of course a fine goal here in life when that is possible.
I do not think that one should rule out good proposals that could have the intended effect. Then we know that these are tough economic times, and even a government needs to make priorities in budget investments. I think we have made a very clear prioritization of energy efficiency in general, both in terms of crowns and öre and in mandates to our agencies as well as in governance in general, which, area by area, is moving more and more in this direction.
I want to emphasize that now that the rot deduction is being expanded for next year, there is nothing preventing households from using it for just energy efficiency measures. We know that there is pressure on this part of the industry; this is something that many households have heard about. They are trying to review what could be reasonable alternatives moving forward in order to be able to lower electricity bills and increase energy efficiency in their homes. The expanded rot deduction is perfectly suitable to be used in this way.
Fredrik Olovsson raises the issue of the white certificates. It is a measure that I am happy and pleased that we chose not to proceed with. I thought at first glance that it was not an easy decision.
The Swedish Energy Agency has, however, been commissioned on three occasions to investigate the need for and the consequences of different ways to design a quota system for energy savings. The agency has then concluded that such a system should not be introduced in Sweden, partly because the instrument is not judged to be socio-economically efficient as it is not considered to correct any market failure that other instruments do not already aim to correct. In plain terms, this means that the expert agency has repeatedly concluded that a quota system is not the most effective instrument to ensure that energy efficiency increases. In that case, it is also not reasonable to proceed with such a proposal here.
What I understand is that this is a proposal that has been pushed very hard, primarily by Miljöpartiet, and I understand that even within the Socialdemokraterna, an evaluation and revision is currently underway regarding whether it has been right to let Miljöpartiets policy steer the climate policy as much as it has done over the last eight years. I think that the demand for white certificates still, despite the system having been so heavily condemned by our expert authority on several occasions, shows that the review is welcome to continue. We need to continue doing what is good, not just what sounds good.
Since then, I am gladly humble that there may be several proposals that the Social Democrats are pushing that could be good, but we have not had the opportunity to prioritize everything at once in this budget.
Fredrik Olovsson (S)
Madam Speaker! It is still fascinating that the Green Party has managed to implement this system in so many North American states and other European countries. It is undeniably skillfully done in that case.
We think it would have been reasonable to let the special investigator who had this assignment complete all of their work. There was not more than a barely a quarter left. Then there would also have been opportunities for both Ebba Busch and me to think that it was either a good proposal or a bad proposal. Now we don't really know that, but we have to rely on others' opinions that have been put forward in other contexts. I think it is a pity.
When it comes to the reinforcement, the expansion, or whatever one should say of the tax deduction, it still becomes some kind of luxury tax deduction that is implemented. Fewer households can afford to use that system than the one we have proposed, namely that the subsidy rate is raised from 30 percent to 50 percent and furthermore, the deduction is directed entirely towards energy efficiency.
It would have been a good way to use the state's collective resources. It would have helped many households to both help themselves and, thereby, lower prices for others as well. It would not have cost more; rather, it would have cost a little less. It would also have had a good effect for the whole society. It would likely also have had a much better distribution policy profile, which I also think is important.
Now there are several proposals that have been put forward here. Some are not quite suitable for Ebba Busch, but we will have to see if any other proposals will come instead or if some of these might perhaps be found in a government bill eventually. Even though the electricity system is to be expanded - we will consume more electricity in the future - we must ensure that the use becomes as efficient as possible, both among households and in industry.
Energi- och näringsministern Ebba Busch (KD)
Madam Speaker! To our brave listeners, now or later online, I want to say that quite a lot is happening now in this area, both in the national work and not least internationally, specifically within the framework of our EU cooperation.
It is about the energy efficiency directive, abbreviated EED, and the energy performance of buildings directive, abbreviated EPBD – one can truly get lost in the jungle of abbreviations. All of this culminates in the large climate package Fit for 55, which essentially did not fail but crossed the finish line during the Swedish EU Presidency. This is to be implemented in Swedish legislation on October 11, 2025. We look forward to getting to work on it.
Work is now in full swing to analyze the proposed legislative changes and other measures that may be necessary to implement this. Just as the interpellator Fredrik Olovsson points out, we will also present a new bill regarding energy policy, and that also includes the issues of energy efficiency.
I have every reason to believe that we will meet again on these issues.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.