The Impacts of Large-Scale Implementation of Solar Power in the Nordic Power Market

Solar energy plays a pivotal role as an economically attractive option in achieving carbon neutrality, with numerous solar photovoltaic (PV) projects planned globally in the coming years. However, increased solar PV capacities leads several economic challenges in the electricity market. This research presents the potential impacts on power market due to the solar PV capacity expansion in the Nordic region by 2030 using Finland as a case study. A detailed representation of the Nordic and Baltic energy systems is modelled using PLEXOS energy system modelling tool. The study quantifies the cannibalisation impact on Finland due to the additional solar PV capacity levels in different parts of the Nordics through scenario analysis. Solar cannibalisation is quantified with solar capture rates and solar unit revenues. In the Base case with the current outlook of solar PV, capture rate of solar generation has the potential to reach 63% in 2030. Conversely, a substantial solar capacity expansion could potentially reduce the capture rate down to 15% in 2030.