The Nordic power system is in the middle of a radical transformation as this region transitions to emission-free energy to meet ambitious climate goals of the four Nordic countries. Finland aims to become carbon neutral by 2035; Sweden by 2045 (with interim milestones for 2030 [63 per cent] and 2040 [75 per cent]); Denmark by 2050 (with a 70 per cent milestone for 2030); and Norway aims to become a low-emission society (with 90-95 per cent reduction) by 2050. The ongoing electrification and increased electricity consumption will require large volumes of clean electricity generation. These developments will bring significant changes to all parts of the power system. The Nordic capacity balance will be tighter with high growth in electricity consumption and a surge in intermittent power production. Flexibility and storage, along with sufficient dispatchable power plants, will be vital to ensure system stability and adequacy. At the same time, there is a lot of uncertainty driven by external factors including geopolitical changes, global competition and high costs for key technologies. The willingness to pay and technology costs will decide the extent and speed of power system expansion.
Massive investments in the transmission grid will remain key to smooth energy transition. The four Nordic transmission system operators (TSOs) – Energinet.dk (Denmark), Fingrid Ojy (Finland), Statnett SF (Norway) and Svenska kraftnät AB (Sweden) – have intensified and formalised their cooperation on security and preparedness. TSOs have been collaborating to outline a common vision for the future development of the Nordic power system through biennial publication of the Nordic Grid Development Perspective (NGDP). The latest edition, NGDP 2025, released in June 2025, reaffirms the Nordic TSOs’ commitment to build on the solid foundation of long-standing cooperation to jointly address the emerging challenges and develop solutions to enable a successful transition.
This article presents key highlights of the NGDP 2025…
Key trends and developments
The electricity consumption in the Nordic region is expected to increase in the coming decades. However, the extent of this growth, its location and the speed at which it will occur remain highly uncertain. In the short-term, electrification of existing demands in industries, transport and heating will only increase the demand. In the long term, demand will mainly come from new electrified industries including data centres, new industrial facilities and hydrogen production based on electrolysis. The long-term development of electricity consumption will depend on factors such as the competitiveness of electricity prices in the Nordics as well as the maturation of the electrolyser technology. On the supply side, most of the new electricity production will come from wind and solar. While the total energy balance of the Nordic region by 2035 shows a moderate but decreasing energy surplus, there are variations across the region (with Denmark and Finland maintaining around zero balance, while energy balances in Norway and Sweden decrease significantly). The Nordic TSOs plan for substantial grid investments to connect grid users, transport electricity from areas with production to areas with consumption and efficiently utilise production across a wider area. Flexibility in production and consumption is needed to ensure efficient use of energy resources and maintain a high supply security.
Emerging technical challenges
With the rapid introduction of power electronic interfaced devices (PEIDs), the Nordic power system’s technical characteristics are changing swiftly, affecting the system stability, reliability and resilience. Grid stability and other technical aspects also set limits for how the grid can be utilised, in addition to thermal constraints. The fundamental change in system characteristics require new solutions.
The Nordic TSOs established the Converter Dominated Nordic Grid (ConDoN) group in 2022 to identify and solve technical challenges introduced to the Nordic synchronous system due to massive integration of PEIDs. TSOs are working on three key areas under ConDon. First, the Nordic TSOs are collaborating on common guidelines and monitoring practices for managing converter stability issues related to fast dynamics of converter controls. This is mainly driven by the need to handle the expected increase in the capacity of converter-interfaced facilities by three times on the generation side during the next decade alone. On the demand side, data centres, electrolysers and other power intensive industry devices will connect to the grid via converters.
Second, TSOs are developing a joint guideline for grid-forming functionality to ensure a harmonised implementation of grid-forming capabilities within the Nordics. The introduction of such capabilities will enhance the system’s ability to regulate voltage and frequency under normal and disturbed conditions; maintain synchronism and support the system during faults; operate in low-inertia environments or even islanded grids; and improve resilience and dynamic stability. The proposed joint guideline will define consistent performance requirements for grid-forming capable inverters; provide clarity for developers and manufacturers on expectations; enable TSO coordination in planning, grid connection and operation; and support pilot projects and real-world validation of grid-forming behaviour in the Nordic context. Notably, the implementation of key technologies such as high-voltage direct current (HVDC) links, static synchronous compensators (STATCOMs) and battery energy storage systems (BESSs) serve as a foundation for extending grid-forming requirements to other technologies over time.
Finally, TSOs are also taking measures to safely integrate large demand facilities. This is vital to find techno-economically feasible measures to limit the voltage, frequency and rotor angle stability impacts in converter-interfaced generation and load, where active power recovery may take up several seconds, which may have huge cross-border impact. While all Nordic countries have low-voltage-ride-through requirements in place for both synchronous and converter-based generation units in the event of faults, not all countries have requirements in place regarding demand facilities. It is deemed critical to ensure that these requirements are in place and coordinated within the Nordics, considering the possibility of system-wide consequences when integrating large demand facilities.
Efficient grid utilisation and accelerated development
It is important to utilise the existing grid more efficiently, while accelerating network expansion, particularly given the surging costs, long lead times and increasing requests for grid connection. Minor measures in existing grid assets such as temperature upgrades for existing power lines, dynamic line rating (DLR) and replacing limiting network components, such as current transformers, can significantly increase the transmission capacity. The Nordic flow-based market coupling also enables Nordic TSOs to use the transmission grid more efficiently and closer to its operational boundaries, while maintaining a secure operation through automated and digitalised solutions.
To ensure timely grid development, fast-tracking permitting is vital, which currently remains a priority at the European level as well. It can take up to 14 years from planning to commissioning of new transmission lines. Several steps have been taken to shorten permitting times. In Norway, the permitting authority has adopted a fast-track method for the permitting process of simple and well-prepared applications that have minimal impact on public and private interests, and where affected stakeholders do not have objections to the measure. In Sweden, pilot studies have been carried out for a coordinated process for permits when developing new transmission lines. In Finland, permitting authorities have allocated additional resources to address the backlog of projects awaiting permits. In Denmark, three specific areas have been designated as dedicated grid zones as part of the European Union’s Renewables Energy Directive (RED) III implementation, aiming to speed up the permitting process.
Further, TSOs are also scrutinising their internal processes to identify possible reductions in the planning and construction phase. They are collaborating to identify sourcing optimums for critical infrastructure components and upsides from increasing standardisation on components and technical requirements.
Massive transmission investment
Large investments are expected across the region, driven by the ongoing electrification, which requires a substantial buildout of the Nordic transmission grid. Energinet plans to invest around DKK40 billion in the Danish transmission grid from 2025 to 2028, of which approximately 20 per cent is for reinvestments and the remaining 80 per cent for reinforcements. Fingrid will build 6,100 km of new transmission lines during 2024-33 at an annual investment of approximately EUR400 million per year. Statnett plans to invest over NOK150 billion in the Norwegian transmission grid and digitalisation over the next decade, with many grid measures involving reinvestments to increase the transmission capacity by upgrading the existing 300 kV network to 420 kV. Svenska kraftnät plans to build around 1,500 km of new transmission lines and renew another 2,500 km of existing transmission lines during 2024-33. The investments in the transmission grid are expected to reach SEK57 billion during 2026-28 and between SEK17 billion and SEK22 billion annually during 2029-33. Together, the Nordic TSOs will build about 15,000 km of lines and invest around EUR36 billion over the next decade.
The way forward
A strong and resilient transmission grid is the backbone of the energy transition and the Nordic TSOs remain committed to expanding grid capacity at the right pace and magnitude, while ensuring a safe and efficient system operation. This requires effective governance and a supportive regulatory framework, including a more efficient permitting process and a regime that enables anticipatory investments. Energy transition is a joint effort and all stakeholders need to work in tandem to achieve the region’s carbon neutrality goals.
