Sweden has taken a significant step towards addressing its volatile electricity prices and system imbalances by adopting the Financing and Risk Sharing in New Nuclear Power Government Bill. The Riksdag's decision paves the way for the expansion of nuclear power, which is expected to bring greater price stability and lower system costs, ultimately benefiting households and businesses.
In March 2025, the Swedish government introduced this proposal as part of its efforts to tackle climate change and promote sustainable energy sources. Now, with the Riksdag's approval, the act will enter into force on August 1st, 2025.
Minister for Financial Markets Niklas Wykman hailed this development as "a historic announcement that takes responsibility for public financing and taxpayers' money when we enable actors to build new nuclear energy." The expansion of nuclear power is anticipated to drive economic growth, create jobs, and help achieve the climate transition.
The state aid mechanism proposed by the government consists of two main components: government loans and Two-way Contracts for Difference (CfD). Government loans will be provided for the construction and testing of new reactors, as well as planning and other preparatory measures. These loans will require companies to inject share capital into their projects and must be repaid in instalments once a reactor becomes operational.
Two-way Contracts for Difference are a form of hedging arrangement that applies when a new reactor has become operational. In this arrangement, the central government either receives remuneration from the company or pays out to it depending on the electricity price. This mechanism aims to regulate risk and profit sharing between the company and the government.
The conditions for state aid also include mechanisms that regulate profit-sharing arrangements between companies and the central government.
Key Features of the State Aid Mechanism:
Government loans: provided for construction, testing, and planning
Two-way Contracts for Difference (CfD): hedging arrangement with revenue or cost sharing
Regulatory risk-sharing mechanism
Companies wishing to receive state aid for investing in new nuclear power will be invited to submit their applications from August 1st, 2025. Interested parties can find detailed information on the state aid mechanism and application process at government.se.
This development marks a significant milestone in Sweden's efforts to promote sustainable energy sources and drive economic growth while tackling climate change. The expansion of nuclear power is expected to bring about greater price stability and lower system costs, ultimately benefiting households and businesses.
In conclusion, the Swedish government's decision to adopt the Financing and Risk Sharing in New Nuclear Power Government Bill represents a major step forward in the country's efforts to address its electricity challenges and promote sustainable energy sources.