Svk LMA2024 Långsiktig Marknadsanalys

Svenska kraftnät’s long-term market analysis (långsiktig marknadsanalys) for the period to 2050. Published 2024. The “LMA” series is Svk’s major scenario-based outlook on the Swedish and Nordic power system over a multi-decade horizon.

Horizon: To 2050 (with key milestones at 2030, 2035, 2040, 2045)

Methodology

• Model: BID3 — a new commercial dispatch and investment model replacing the earlier EMPS model used in LMA2021 and prior editions. BID3 is better suited for high-VRE systems and captures more complex storage and flexibility dispatch.
• Weather scenarios: 35 historical weather years (1982–2016) for hydrology and wind/solar variability
• Nordic scope: covers all five Nordic countries plus Baltic integration and key European interconnectors
• Scenarios: four scenarios (see below) spanning a range of technology and policy assumptions

Four scenarios

Note: the source’s own two summary exhibits round EP/EF 2045 Swedish demand slightly differently (Figure 1: EP 343/EF 342; Figure 6’s Nordic table: EP 342/EF 343) — a minor internal rounding wobble in the raw document itself, not a transcription error here. The scenario names above are direct translations of the report’s own Swedish labels (p.6: “Småskaligt förnybart (SF), Färdplaner mixat (FM), Elektrifiering planerbart (EP) och Elektrifiering förnybart (EF)”) — the previous English expansions on this page (“Slow Fossil Exit,” “Flexible Market,” “Electrification with Power,” “Electrification with Flexibility”) were invented glosses that did not match the source’s actual scenario names and have been corrected.

EP and EF represent the high-demand, high-electrification pathways — the scenarios where Sweden hosts large-scale green steel, hydrogen production, and broad transport/heating electrification.

Key findings

SE1 price flip — the most counterintuitive finding

SE1 (northern Sweden) has historically been the cheapest Swedish bidding zone, reflecting surplus hydro and wind production with insufficient transmission south. LMA2024 projects a fundamental reversal:

• In high-demand scenarios (EP, EF), SE1 becomes the most expensive Swedish bidding zone by 2040–2045
• Driver: massive new industrial loads in Norrbotten and Västernorrland (LKAB, H2 Green Steel, SSAB green conversion) consume the local surplus production before it can be exported south
• SE1 loses its structural price advantage as local demand grows faster than local production
• This is directionally consistent with KMA2025’s (a later, March 2026 report) near-term observation that SE1 prices rise and exceed SE2 on weekly prices for several weeks, but LMA2024 extends the trajectory further to an actual price premium

This reversal has major implications for:

• Investment siting decisions (production and storage that assumed SE1 price discount)
• NordSyd economics (flow direction may change in high-demand scenarios)
• Interconnector economics (SE1’s export links — LMA2024’s transmission-capacity assumptions include the Aurora line, Messaure–Keminmaa, i.e. northern Sweden to Finland; this implications list is the wiki’s own inference, not stated in the report)

Demand flexibility — essential for adequacy in 2045

In the EP and EF high-demand scenarios, demand flexibility is a prerequisite for system adequacy:

• Without flexible EV charging and hydrogen electrolyzer dispatch, the system accumulates large numbers of shortage hours annually by 2045 in EP/EF scenarios
• The shortage disappears when EV charging shifts to off-peak hours and electrolyzers provide grid balancing (operating as virtual batteries via H2 storage)
• Quantified: the difference between “no flexibility” and “active flexibility” in EP/EF at 2045 is hundreds to over a thousand shortage hours per year — system adequacy fails without it
• This is the strongest quantitative case for demand response and smart charging found in any Svk publication

The finding applies specifically at the system scale: individual DER flexibility was always valuable; LMA2024 establishes it as a system-necessity threshold in high-electrification pathways.

Snitt 1 (SE1–SE2) — highest-marginal-value reinforcement

Snitt 1, the transmission cross-section between SE1 and SE2 at the SE1–SE2 border, shows the highest marginal economic value across all four LMA2024 scenarios:

• Even in SF (slow scenario), Snitt 1 reinforcement has positive NPV
• In EP/EF, the value is very large — the industrial loads in SE1 combined with the need to balance SE1 excess (in low-demand hours) or import capacity (in high-demand hours) creates a persistent, bidirectional capacity need
• This finding supports continued NordSyd investment and potentially additional north-south reinforcement beyond what is currently planned

Scenario comparison vs LMA2021

• LMA2021 was published before the war in Ukraine, before the gas price crisis, and before the green industrial investment wave in northern Sweden
• LMA2024 reflects substantially higher base demand and a wider scenario spread — the EP/EF scenarios reach ~340 TWh vs LMA2021’s highest scenario of ~260 TWh
• The shift from EMPS to BID3 also changes how flexibility and storage are modeled, making LMA2024 results less directly comparable to LMA2021

Nuclear assumptions in EP scenario

EP includes a significant nuclear expansion assumption — existing capacity maintained plus new construction resulting in approximately double current nuclear output (~110 TWh/year) by 2045. This assumes:

• Life extension of all existing units (Ringhals 1 and 2 would need restart; Forsmark 1–3 and Oskarshamn 3 continued)
• New construction of 2–4 large reactors or equivalent SMR capacity
• The Swedish government’s stated policy to enable new nuclear serves as the policy basis, though no firm construction decisions had been taken as of LMA2024’s publication

Balancing and flexibility market implications

• Balancing needs in EP/EF grow substantially as the share of weather-dependent production rises and hydropower alone can no longer cover regulation — the report does not give a specific quantified aFRR growth multiple (a previous version of this page’s “aFRR volumes must more than double” claim could not be traced to the raw text and has been removed)
• Demand-side flexibility (EV, electrolyzer, heat pump) becomes the primary source of balancing capacity in high-electrification scenarios — not just a supplement to generator-side reserves
• The analysis supports Svk’s position that Nordic Balancing Markets architecture must be designed to accommodate large demand-side resources by 2035 at the latest

Relationship to other sources

• Connects to Source - Svk KMA2025 Kortsiktig Marknadsanalys — the later, short-horizon (2026–2030) companion analysis; its SE1 price movement is directionally consistent with the longer-term LMA2024 trend (KMA2025 post-dates LMA2024, so it is not LMA2024’s baseline)
• Connects to Source - Svk Verksamhetsplan 2026-2028 — investment plan’s Snitt 1 / NordSyd prioritization is consistent with LMA2024’s economic analysis
• Connects to Source - Svk Systemutvecklingsplan 2022-2031 — older transmission planning document; LMA2024 supersedes its scenario analysis

Relevance to wiki

• Demand Response — strongest quantitative case for DR as a system necessity in 2045; EV and electrolyzer flexibility at scale
• Bidding Areas — SE1 price flip; SE1–SE2 price dynamics long-term; zone economics reversal
• NordSyd — Snitt 1 as highest-value reinforcement; investment economic case confirmed
• Svenska kraftnät — official scenario basis; model transition from EMPS to BID3
• Balancing Markets — balancing volume growth in high-VRE scenarios; demand-side reserve dominance by 2045
• Vehicle-to-Grid — EV flexibility as system-necessity finding; smart charging scale implications