Swedish Procurement and Market Activities — Different Design Solutions on Different Markets

This paper presents will give an overview of how the Swedish programme for energy efficiency is designed to affect market transformation, as well as which factors affect the programme design and how the different approaches perform. The 10-year old Swedish programme for energy efllciency has produced 25 procurements within the residential, commercial and industrial sectors. This programme aims at establishing market transformation and consists of technology procurement and projects supporting market penetration. There is a wide variety of methods in use, each of them are designed according to the market barriers, its actors, decision makers, their interplay, and specific market needs, expectations and conditions. The combination of different methods and the strength of market forces have made the Swedish programme for energy efficiency successful as a policy option. It has succeeded in establishing some sustainable changes on the market. A key conclusion is that the success of any programme is heavily dependent on the vigour with which it is managed and, in Sweden, supported by The National Board for Industrial and Technical Development (NUTEK) and its trade allies. (NUTEK’S activities were taken over by the Swedish National Energy Administration as of January 1, 1998.) The different programme designs, both more and less successful, are highlighted below with examples. The overall list of procurements, their performance and methods are given in the appendixes. Appendix 1 has a full list of the technology procurement programmed and their performance. Appendix 2 has a full list of the activity packages that have followed each of the procurements. The Role of Technology Procurement Since the end of the 80’s, technology procurement has been one of the key elements in transforming the Swedish energy system towards increased use of efllcient end-use technologies. Until the end of 1997, the Department of Energy Efficiency at the Swedish National Board for Industrial Development (NUTEK) has been responsible for these activities. Following a parliament decision in 1997 to start phasing out the first of twelve Nuclear reactors by mid-1998, a new agency was formed, The National Energy Administration (EM), which took over all of NUTEK’S energy-related activities. Although the responsibility for these activities have changed, we will refer to the Department of Energy Ei%ciency at NUTEK as “NUTEK’ in the following discussion. In the way the Swedish programme for energy efllciency is designed, technology procurement acts as a starting engine for market transformation. It gathers all purchasers’ requirements for a given product, including even features other than energy efficiency. It is important to integrate these other features in the requirements in order to make the new product more interesting to the actors involved in the decision making and purchasing. The manufacturer has often-incomplete information about users’ Swedish Procurement and Market Activities -7.311 Subsupplier Manufacturer u Participating actor +ho’e=,er 0 ‘n’encingac’or II ~ product flow ARetailer Relation e.g. busines relation E.g. electric installation contractor