Swedish Offshore Wind : Modelling development pathways to commercial viability

Abstract: Offshore wind will play an important role in Sweden’s fossil-free energy future. Although Sweden has many offshore wind farms in the planning and approval stages, few projects have been built, and little public research on which offshore wind areas and individual farms are most economically viable. This master’s thesis models the development of Swedish offshore wind from 2021 to 2050 and beyond by assessing individual offshore wind farm areas from a system perspective. Individual wind farm characteristics, including their costs and capacity factors, are modelled along with other power generation technologies and electricity demand forecasts for Sweden and the surrounding six countries to arrive at the least-cost optimized electricity mix for each year in the model period. A range of techno-economic and Swedish policy scenarios are simulated. The results inform which offshore wind farms are the most economical to build out, when, under what conditions, and the marginal price of electricity in each scenario. The model results show that high electricity demand is the biggest driver of offshore wind expansion, followed by a fast cost reduction. Additionally, while policy interventions such as allowing investment in nuclear power, expanding grid transmission capacity, and encouraging electrification can have opposing effects on the price of electricity, they contribute more towards lowering electricity prices when implemented together.