The role of energy efficiency in the deregulated Swedish electricity market

Four years have passed since January 1996 when retail competition was introduced in the Swedish electricity market. These years have been characterized by a rapid restructuring of the electricity supply industry through mergers and acquisitions, lower electricity prices, and a search for new marketing strategies in the competitive market. General trends and the results of two market surveys, undertaken in 1999, of energy efficiency services from electricity suppliers in Sweden are reported here. One survey targeted a sample of industrial and commercial customers, and one survey targeted all electricity suppliers. Energy services, in particular energy efficiency services, are offered by 83 per cent of the surveyed electricity suppliers. Customer relations and building customer loyalty is reported by 88 per cent of the suppliers as a motivation for offering energy services. Nearly half of the customers report a great confidence in the suppliers' ability and sincerity to deliver energy efficiency services. 22 per cent of the customers have contracted for energy efficiency services and those customers that have contracted for energy services have often contracted for several services. Less than 20 per cent of the customers think energy services is a way for suppliers to distract customers and remove focus from electricity price. In both surveys, roughly half of the respondents report that services are priced separately from electricity. The future role of government to facilitate and support the market for energy efficiency services is discussed based on market experiences so far.