Swedish Industrial Sector Research Articles

Navigating uncertainty: exploring electricity demand dynamics in Swedish industrial sectors amid global shocks and instability

This study aims to provide insights into the factors shaping electricity demand in Swedish industrial sectors using the nonlinear version of the autoregressive distributed lag model (NARDL). This approach captures the complex short- and long-run relationships between uncertainty and electric power use in Swedish industrial sectors. The results reveal sector-specific responses to uncertainties and asymmetries in electricity use patterns. By examining the entire industrial sector in Sweden, this approach uncovers underlying issues and hidden patterns, while also providing insights into the functioning and behaviour of industrial systems. The rapid electrification and new green industrialisation initiatives in Sweden, coupled with the integration of a circular economy, underscore the importance of understanding the dynamics of electricity use in the face of uncertain shocks. This knowledge is vital for ensuring, amongst other things, grid stability, mitigating the need for costly peaking capacity, and identifying potential challenges in the interconnection of energy and material circular flows.

The Value of Lost Load in Swedish Industry

The power system is undergoing a drastic transition towards a system with high degree of intermittency at the same time as the transition in other sectors will require more electricity. Taken together this will make it more challenging to keep the instantaneous balance between demand and supply in the power market with increasing risks of interruptions and power outages as a result. The objective of this study is to estimate the cost of power outages in the Swedish industrial sector by using firm- level, production data. Our estimates of interruption costs are based on firms’ actual behavior concerning their use of electricity and the values created. The main approach is complemented with a qualitative study based on a questionnaire targeting key-persons in a small number of industrial production facilities. The purpose with this is to identify firm or facility specific aspects that that are not revealed by annual firm level data. The main conclusion from this study is that the costs for the industry of supply interruptions are considerable, and seems to have increased over time, suggesting that the industrial sector has become more vulnerable to supply disturbances. In 2016 the estimated cost of a one-hour outage for an average industrial facility in Sweden was approximately 23 times larger than the value of the electricity not delivered (SEK 9502 versus SEK 400), whereas the cost in 2004 was approximately 13 times the market value of the electricity not delivered. However, there is substantial variation across firms and sectors. For an average facility in the electro and motor vehicle industry, for example, a one-hour cost is, according to our estimates, about 120 and 105 times the market value of the electricity not delivered, respectively (SEK 43680 versus SEK 415 for an average motor vehicle firm). In the pulp and paper industry, on the other hand, the outage cost is only about 5 times the value of undelivered electricity in spite of a relatively high outage cost in absolute value (SEK 27730). The reason for the relative low ratio for the pulp and paper industry is the very high level of electricity intensity. The estimated costs should however be interpreted with care since they are based on the assumption that the interruption in production processes corresponds exactly to the duration of the outage, but also that the production losses during the outage are lost forever and cannot be compensated for in any way. Importantly, according to the results from our survey most firms or production facilities reported that the production interruption becomes noticeable longer than the power outage itself. In addition, most of them reported additional costs because of an outage, such as costs for overtime and delivery delays. On the other hand, several facilities firms reported that they may be able to “take back” the production losses during a year. Altogether, the first effects seem to dominate according to the survey results and the cost estimates reported should therefore be interpreted as lower bounds.

The Value of Lost Load in Swedish Industry

The power system is undergoing a drastic transition towards a system with high degree of intermittency at the same time as the transition in other sectors will require more electricity. Taken together this will make it more challenging to keep the instantaneous balance between demand and supply in the power market with increasing risks of interruptions and power outages as a result. The objective of this study is to estimate the cost of power outages in the Swedish industrial sector by using firm-level, production data. Our estimates of interruption costs are based on firms’ actual behavior concerning their use of electricity and the values created. The main approach is complemented with a qualitative study based on a questionnaire targeting key-persons in a small number of industrial production facilities. The purpose with this is to identify firm or facility specific aspects that that are not revealed by annual firm level data. The main conclusion from this study is that the costs for the industry of supply interruptions are considerable, and seems to have increased over time, suggesting that the industrial sector has become more vulnerable to supply disturbances. In 2016 the estimated cost of a one-hour outage for an average industrial facility in Sweden was approximately 23 times larger than the value of the electricity not delivered (SEK 9502 versus SEK 400), whereas the cost in 2004 was approximately 13 times the market value of the electricity not delivered. However, there is substantial variation across firms and sectors. For an average facility in the electro and motor vehicle industry, for example, a one-hour cost is, according to our estimates, about 120 and 105 times the market value of the electricity not delivered, respectively (SEK 43680 versus SEK 415 for an average motor vehicle firm). In the pulp and paper industry, on the other hand, the outage cost is only about 5 times the value of undelivered electricity in spite of a relatively high outage cost in absolute value (SEK 27730). The reason for the relative low ratio for the pulp and paper industry is the very high level of electricity intensity. The estimated costs should however be interpreted with care since they are based on the assumption that the interruption in production processes corresponds exactly to the duration of the outage, but also that the production losses during the outage are lost forever and cannot be compensated for in any way. Importantly, according to the results from our survey most firms or production facilities reported that the production interruption becomes noticeable longer than the power outage itself. In addition, most of them reported additional costs because of an outage, such as costs for overtime and delivery delays. On the other hand, several facilities firms reported that they may be able to “take back” the production losses during a year. Altogether, the first effects seem to dominate according to the survey results and the cost estimates reported should therefore be interpreted as lower bounds.

Vocational students’ identity formation in relation to vocations in the Swedish industrial sector

This article investigates vocational identity formation among students studying vocational education programmes that focus on vocations within Sweden’s industrial sector. The empirical material is based on twenty-eight qualitative interviews with students enrolled on industrial programmes at four upper secondary schools. Taking a situated learning perspective as our starting point, the study reveals how the students’ vocational identity formation can be understood by examining their learning trajectories, which are shaped by their social backgrounds, their perceptions of workplace-based learning and industrial vocations, and their thoughts about their vocational futures. The findings demonstrate that students’ vocational identity formation is not a single linear process. On the contrary, three learning trajectories emerged which correspond to three different student groups. The students oriented towards commitment intended to work in industrial vocations, while the students oriented towards flexibility were open to the possibility of careers outside the industrial sector, and the students oriented towards ambivalence had no obvious plans for their vocational futures. In conclusion, this article suggests that in order to better understand the formation of vocational identities, the notions of learning trajectory types and social categorisations need to be considered in greater depth and understood in relation to the upper secondary school environment.

Energy intensity and convergence in Swedish industry: A combined econometric and decomposition analysis

How to reduce the carbon footprint associated with energy use is still a major concern for most decision-makers. Against this background, a better understanding of energy intensity—the ratio of energy use to output and its convergence could be important in the design of policies targeting the reduction in the carbon footprint related to energy use. This paper analyzes the determinants of energy intensity and tests for energy intensity convergence across 14 Swedish industrial sectors. This analysis builds on a nonparametric regression analysis of an intensity index constructed at the industry sector level as well as indices constructed from a decomposition of this index. The latter isolates two key determinants of changes in energy intensity and convergence patterns: the efficiency channel-fundamental improvement in the use of energy and activity channel-structural shifts in the economy. The empirical analysis relies on a detailed sectorial dataset covering the period 1990–2008. The findings indicate that input prices, including the price of energy, have been significant determinants of energy intensity in the Swedish industrial sectors. This effect can primarily be attributed to the efficiency channel and with a less profound influence from the activity channel. We also find evidence of energy intensity convergence among the industrial sectors, and this primarily stems from the activity channel rather than from the efficiency channel.

Energy Intensity and Convergence in Swedish Industry: A Combined Econometric and Decomposition Analysis

This paper analyzes the determinants of energy intensity and tests for convergence across 14 Swedish industrial sectors. The analysis builds on a non-parametric regression analysis of an intensity index constructed at the industry sector level as well as indexes constructed from a decomposition of this index. The latter isolates two key determinants of changes in energy intensity and convergence patterns: energy efficiency improvements and changes in economic output (activity). The empirical analysis relies on a detailed sectorial dataset covering the period 1990-2008. The findings indicate that input prices, including the price of energy, have been significant determinants of energy intensity in the Swedish industrial sectors. This effect can primarily be attributed to the efficiency channel and with a less profound influence from the activity channel. These results suggest that a well-designed tax system could be effective in delivering significant energy efficiency improvements in Swedish industry. We also find evidence of energy intensity convergence among the industrial sectors, and this primarily stems from the activity channel rather than from the efficiency channel. The above implies that during the studied time period Swedish industry shifted away from more to less energy-intensive production, in part perhaps driven by moving energy-intensive manufacturing abroad.

Convergence of carbon dioxide performance across Swedish industrial sectors: An environmental index approach

The overall objective of the paper is to analyze convergence of CO2 emission intensity across manufacturing sectors in Sweden. Our approach differs from previous work on carbon convergence in that it employs a theoretical framework to construct a CO2 performance index, which explicitly takes into account that industrial firms produce good as well as bad outputs. This index is then used as the dependent variable in a growth-type regression equation. We employ a data set covering 14 industrial sectors over the time period 1990–2008. The results suggest the presence of conditional β-convergence in CO2 performance among the industrial sectors in Sweden. Moreover, the speed of convergence varies significantly in the sense that the higher the capital intensity is, the lower is the convergence rate to the different steady states. This is likely to reflect the importance of – and in part the costs associated with – capital turnover to achieve a transition towards lower CO2 emission paths.

Convergence of Carbon Dioxide Performance Across Swedish Industrial Sectors. An Environmental Index Approach

The overall objective of the paper is to analyze convergence of CO2 emission intensity across manufacturing sectors in Sweden. Our approach differs from previous work on carbon convergence in that it employs a theoretical framework to construct a CO2 performance index, which explicitly takes into account that industrial firms produce good as well as bad outputs. This index is then used as the dependent variable in a growth-type regression equation. We employ a data set covering 14 industrial sectors over the time period 1990-2008. The results suggest the presence of conditional β-convergence in CO2 performance among the industrial sectors in Sweden. Moreover, the speed of convergence varies significantly in the sense that the higher the capital intensity is, the lower is the convergence rate to the different steady states. This reflects the importance of – and in part the costs associated with – capital turnover to achieve a transition towards lower CO2 emission paths.

Energy in Swedish industry 2020 – current status, policy instruments, and policy implications

The EU has established so-called 20–20–20 targets, which in relation to energy mean that each Member State shall improve energy intensity levels by 3.3% annually, leading to a reduced primary energy use of 20% by the year 2020, calculated from a projected level based on the primary energy use in 2005. Sweden has established a less ambitious target of 1.7% annual energy intensity improvement through 2020. The aim of this paper is to evaluate, ex-ante, the EU 2020 primary energy target for the Swedish industrial sector. An applied backcasting methodology is used. The assessment made in this paper is that actions that lead to between 31.6 and 33.2 TWh/year reductions in energy end-use are needed if the EU target is to be achieved. Results from this paper shows that the current energy policy instruments are not sufficient to the EU or Swedish targets. Estimations in this paper are that a primary energy target of about 22.3 TWh/year is reasonable. The paper concludes by presenting a roadmap on how the Swedish 2020 target can be achieved through: i) energy management; ii) energy-efficient technology; and iii) energy supply measures, with an approximate cost of 280–300 MEUR or 75–80 kWh per public EUR. Three major additional policy measures are needed compared with the current policy: including all energy carriers, not just electricity, in the Swedish long-term agreements program PFE; setting up networks; and making it possible for third parties, i.e., industry, to deliver excess heat into the monopolized Swedish district heating grids.

The Future Gap: Exploring a Critical Reflective Stakeholder Approach

The focus of this paper is a participatory design process that is used as a means to enable multiple stakeholders' collaboration in discussing strategies, designs and solutions of a conceptual future factory. The reason for this study is the Swedish industrial sector's difficulty in attracting women and young people. The design process can adapt to various complexities, building on the creative and innovative ability of collaborating people. In the present study, young people participated in explorations of images and perceptions of the current industrial sector and in an inquiry into the needs and preferences of a future factory. This activity resulted in two future scenarios: utopia, a positive future vision, and dystopia, a pessimistic outlook. These scenarios subsequently were used as means for critical reflection with multiple industrial sector stakeholders, exploring the future gap as the discrepancy between the images, perceptions and understanding held by internal stakeholders compared to external stakeholders. In this paper, we propose scenario-based design as one approach to multi-stakeholder activities, both for understanding various stakeholder needs and preferences and for critical reflection on future strategies and visions with a diversity of stakeholders. We believe there is a need for a transformation in the way in which organizations involve and connect to stakeholders.

Entry, market turbulence and industry employment growth

This paper investigates the relationship between industrial dynamics in terms of firm entry, market turbulence and employment growth. Do entry of firms, the composition of industry dynamics (net entry) and market turbulence (entry and exit) influence industrial employment growth? This paper provides an empirical investigation, using unique data for 42 disaggregated Swedish industrial sectors during the period 1997-2001. It is hypothesised that the importance of entering firms, net entry and market turbulence may differ significantly across industries. A quantile regression method is used in order to detect industrial differences in the response to industrial employment growth. The empirical evidence shows that, on the one hand, firm entry and market turbulence have a positive effect on employment for fast growing industries and that the effect is larger for high growth industries. On the other hand, the composition of industry dynamics in terms of net entry rates has a more dispersed effect across all industries, even though the effect of net entry is larger for high growth industries.

Statistical Methods – Does Anyone Really Use Them?

Students taking courses in quality management at Luleå University of Technology receive extensive education in statistical methods. To improve the education and to understand what kind of competence students need when they graduate, a survey was preformed examining how and to what extent the methods Statistical Process Control, Capability Analysis and Design of Experiments are used by organisations hiring the alumni. The result shows that the students employed in the Swedish industrial sector witness a modest use of statistical methods, while use of statistical methods in other sectors hiring the alumni is uncommon. Lack of competence and resources within the organizations are stated as hindrances to expanded use. Conclusions from the study are that implementation techniques must be emphasized in the curriculum and that different types of courses should be given – practical, hands-on courses for engineers, managers and others working in organizations. Furthermore, courses offered at universities must have a strong focus on practical problems such as difficulties randomizing experiments and that graphical methods should be favoured.

Baumol's disease and dematerialization of the economy

This paper argues that there is reason to be skeptical about the idea that the transition to a service economy will bring about dematerialization of production and consequent environmental improvement. This is because the shift to a service economy is an illusion in terms of real production, but is instead generated by the fall in the price of manufacturing goods relative to services, which is in turn caused by more rapid productivity growth in manufacturing than in services. This argument relies on the insights Baumol provided on the nature of the service economy and uses Swedish long-term data on relative sectoral development as an empirical illustration. On the other hand, the paper argues that there is reason to be cautiously optimistic that structural change may bring about a greening of growth, namely the changes in growth patterns sometimes labeled the third industrial revolution, which is connected to the emergence of microelectronics. Swedish CO 2 emissions show a decline after 1970, which is mainly explained by a politically driven change in the mix of energy carriers, but is also related to the stabilization of energy consumption. This energy stabilization was caused by slow growth of the economy in conjunction with substantial declines in energy intensity within industrial sectors and an absence of relative growth of the heavy sectors, a growth that had marked the economy between 1870 and 1970. Microelectronics have contributed to permanently transforming the Swedish industrial sector in a lighter direction, reducing energy losses in heavy industries and stabilizing household energy consumption. So it appears as if there may be some environmental gains from this development that was initiated in the 1970s, but not from relatively more production in the service sector.

The role of excess capacity in reaching and holding on to success: evidence from Swedish industrial development

During the second half of the 19th century, Sweden was transformed from a poor agricultural economy into an industrial economy with a relatively high level of technology. This development was spearheaded by raw material intensive industries: wood products, pulp and paper, and iron ore. Today, the same industries are still highly competitive and make up a substantial share of the Swedish industrial sector. This article asks how Sweden was able to industrialise so rapidly, and how raw material intensive industries have maintained their competitiveness for over 100 years. We argue that excess capacity in learning, human capital, and institutions account for part of the answers to both questions. We also argue that benchmarking – drawing on the experiences and lessons from competitors and role models – may provide a tool for deciding what kind of excess capacity may be needed to prepare for various challenges in economic and industrial development.

Occupational Health Service for Farmers in Sweden

Farming is an occupation in which risks and many health hazards have been identified. Unlike other Swedish industrial sectors, agriculture has not had an occupational health service until recently. At the initiative of local farmers' groups, a trial program was started in 1977, and occupational health care for farmers and farm workers has gradually developed since then. Today, 35,000 farmers are affiliated on a voluntary basis. The occupational health program offers biennial health checkups, along with informational activities and farm visits during the interim. Nurses, physicians, and physiotherapists deal with work-related symptoms and diseases, and safety engineers conduct farm visits. The large number of environmental hazards existing in agriculture constitutes a spur to further development of the occupational health service and to research. Results so far are promising, and occupational health care in agriculture should be encouraged.

The contribution of the manufacturing industry to the GDP of Sweden: 1941–1951

Abstract The value added of the Swedish industrial sector has earlier been calculated by Osten Johansson (OJ)2 and the Economic Research Institute (Konjunkturinstituiet, KI). 3 However, these calculations have proved to be in need of revision on various points. In the following pages new calculations are shown for a shorter period, 1941–51. Furthermore, an attempt has been made to construct a new price index since the earlier calculations of fixed prices for the industrial production also have certain weaknesses.