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This exact same thing just happened to my 98 S70 T5.
In my case, I could hear the fan make a slight groan
noise before it was shut down. The fan had failed and
was drawing too much current and the electronics shut it
down. Restart the car and the fan would run a second or
two until it was automatically shut down and the dash
lights started to flash (happened around Christmas and
it was quite the seasonal display on the dash).
Based on the sound I heard from the fan and the people on
this board indicating that blower fan failure is common
I went ahead and replaced the fan (it is behind the glove
box).
The fan housing was $140 from www.volvoparts.com and I was
able to replace it in less then an hour (I do have some
mechanical experience, though). The job is pretty simple.
A mechanic would read the codes to be more sure of the problem.
In my case, failed fan was the problem and it is now working fine
(just in time for window defrosting season).
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