Sweden's Nuclear Power Revival: State Support Fuels Future Construction

The Swedish government has proposed state loans and power price guarantees to fund the construction of four new nuclear power plants, aiming to boost electricity output and cut carbon emissions. This plan addresses private sector concerns over profitability and aligns with the nation's future energy demands.

The Swedish government is initiating financial support mechanisms, including state loans and power price guarantees, to facilitate the construction of four nuclear power plants. This move is a strategic effort to increase electricity output and reduce carbon emissions as the country eyes a shift from fossil fuels.

In anticipation of a rise in electricity demand to 300 terawatt hours by 2045, the government recognizes the necessity of building 10 new large reactors and has committed to addressing profitability concerns from private investors. Estimated costs run into tens of billions of dollars, and state intervention is seen as crucial.

The proposal outlines a contract-for-difference power price mechanism to enhance income for producers, with an emphasis on gaining European Commission approval under EU state aid rules. State-owned utilities like Vattenfall have welcomed the initiative, while Finnish utility Fortum acknowledged the need for state support given the commercial challenges.

(With inputs from agencies.)