Despite having a reputation for being an expensive country, the living cost in Sweden is relatively cheaper than in the U.S.
However, recent development regarding the price of electricity might make you wonder if moving is still worth it.
Let’s talk about electricity prices and what affects them.
How Much Does Electricity Cost in Sweden?
As of this article’s writing, the electricity price in Sweden is actually $0.066 (0.68 kr) per kilowatt hour.
You’ll find this a huge relief after the $0.27 (2.76 kr) per kWh of December 2022.
How Have Electricity Prices Changed Over Time in Sweden?
2022 electricity prices were a record high in the country.
To give you a better idea of how these prices (without taxes) have changed per period for households per kWh, we’ve listed bi-annual data from June 2017 to December 2022:
- June 2017 – $0.14 (1.43 kr)
- December 2017 – $0.14 (1.43 kr)
- June 2018 – $0.13 (1.33 kr)
- December 2018 – $0.14 (1.43 kr)
- June 2019 – $0.14 (1.43 kr)
- December 2019 – $0.15 (1.53 kr)
- June 2020 – $0.13 (1.33 kr)
- December 2020 – $0.14 (1.43 kr)
- June 2021 – $0.15 (1.53 kr)
- December 2021 – $0.19 (1.94 kr)
- June 2022 – $0.20 (2.05 kr)
- December 2022 – $0.27 (2.76 kr)
Factors Affecting Electricity Prices in Sweden
Electricity prices keep changing based on several factors.
Let’s discuss each factor one by one.
Energy Taxes
Energy taxation follows the “polluter pays” principle — and it’s currently Sweden’s foundation for climate policies.
Basically, anything involving non-renewable energy is more expensive than those that use renewable energy — like water and sunlight.
Energy taxes aim to:
- Inspire the use of renewable energy sources
- Improve energy efficiency
- Reduce electric energy consumption
Energy taxes were introduced in 1991. The tax level was increased gradually to give people time to adjust.
Currently, energy taxes on electricity cost $0.32 (3.27 kr) per kWh.
System Charges
Sweden has had a deregulated electricity market since 1996.
The electricity used in Sweden is created both abroad and locally. However, all electricity is distributed throughout the country through a common electricity network.
However, electricity sales are quite competitive, with over 120 suppliers to choose from.
Network Fees
The Swedish Energy Markets Inspectorate (Ei) regulates electricity network fees.
Ei checks the total revenue of electricity grid operators. From there, they ensure that network fees are reasonable, objective, and non-discriminatory.
Consumption Charges
Finally, how much energy you use affects how much you’ll pay. However, electricity prices also depend on your location.
For instance, southern Sweden has higher prices than other parts of the country.
Cost Comparison of Different Types of Electricity
The cost of your electricity will vary based on what type of consumer you fall under.
Household
December 2022 saw the highest electricity costs ever recorded in Sweden.
Swedes paid an average of $0.30 (3.07 kr) per kilowatt hour (including taxes). Those who didn’t pay taxes had to shell out $0.27 (2.76 kr) for each unit of energy consumed.
It’s safe to say that these prices are at an all-time high – a fact which surely will not be celebrated by Swedish citizens!
These prices are actually a record high.
In fact, within the second half of 2022 alone, electricity prices in Sweden increased by 43.62%.
Industrial
As of 2021, research shows that annual consumption of less than 2,000 megawatt hours cost $0.068 (0.70 kr) per kilowatt hour.
Meanwhile, industrial consumers who use 20 to 70-gigawatt hours cost $0.056 (0.57 kr) per kilowatt hour.
Commercial
Similar to industrial consumers, an annual consumption of less than 2,000 megawatt-hours has a price $0.068 (0.70 kr) per kWh. 20 to 70-gigawatt hours have a price of $0.056 (0.57 kr) per kWh hour.
Electricity Price Trends
The price of electricity in Sweden is certainly currently high. Let’s check out how electricity prices have been trending as of late.
Recent Trends
The Swedish government has offered financial support for households throughout the country.
For households in the south, this will be based on their electricity consumption during the period between October 2021 to November 2022.
For the rest of the country, the amount of electricity it got was based on its consumption from November to December 2022.
However, only households who have written their name on the electricity contract by December 2022 will receive help.
In February 2023, statistics from Ember show that Sweden had its highest share of wind power generation with 27%.
Finally, energy taxes also varied according to business type. This means businesses can experience tax reduction and exemption opportunities if they reach certain standards.
Future Outlook
As 2030 is fast approaching, the European Union is on pace to reach its 32% renewable energy share goal.
Sweden is blazing a trail with an astonishing 63% renewable energy share, all thanks to the Swedish Energy Agency’s commitment to sustainability.
This government agency has been essential in helping the country accomplish this remarkable feat and uphold its strong record of environmental responsibility.
If they keep up their dedication to alternative sources of power and other green activities, it won’t be long until more countries within the EU can follow suit.
Statistics on Electricity in Sweden
Below is a quick breakdown of Sweden’s electricity generation by type of production as of February 2023:
- Conventional thermal power through non-renewable waste, coal, natural gas, oil, and other less common non-renewable fuels – 196 GWh
- Conventional thermal power through renewable waste, solid biofuels, biogas, peat, and other less common renewable fuels – 1,288 GWh
- Wind power – 4,046 GWh
- Water power (including pumping power) – 5,748 GWh
- On-grid solar power (including measured production of electricity supplied to the grid) – 101 GWh
- Nuclear power (condensation) – 3,873 GWh
For more information, check out Statistics Sweden, which provides official statistics on various subjects.
Frequently Ask Questions
If you’d still like a shot at the best places to live in Sweden, we’ve answered some questions that can help you understand the country’s electricity situation more:
What Else Impacts the Electricity Prices in Sweden?
At the end of the day, supply and demand is what impacts the electricity price in Sweden.
However, Sweden is part of a common electricity market in Europe. As such, electricity is also a European issue rather than just a Swedish problem.
If the electricity producers in other countries encounter problems, it will also affect Sweden and other European countries.
Why Are Electricity Prices So High in Sweden?
The high electricity prices are because of the high energy prices all over Europe.
Some reasons for the increase in energy prices include: Generating electricity using fossil fuels is now more expensive in the EU.
Some reasons for the increase in energy prices include:
- Generating electricity using fossil fuels is now more expensive in the EU.
- Gas has become more expensive because of the Ukraine war.
- Nuclear power plants are being decommissioned in the EU.
- Aside from Sweden, Germany and France have closed multiple plants in recent years.
Why Does Sweden Export Electricity When the Prices Are So High?
Sweden is part of a common electricity market with other European countries. As such, they should follow trade rules — which include exporting electricity.
Despite that, being part of a common market in Europe is more beneficial since countries can help match one another’s supply and demand.
For instance, if Sweden is low on wind power, they can import from other countries for some time.
Has the Shut Down of Nuclear Power Plants Led to Higher Electricity Prices in Sweden?
Yes, but only to an extent.
Sweden shutting down nuclear power plants had a relatively small effect on electricity price.
However, it has affected southern Sweden much more since it doesn’t have a lot of other ways to produce electricity.
Can We Compensate for the Phasing Out of Nuclear Power?
Yes, we can compensate for the phasing out of nuclear power. Here are some tips to achieve just that:
- Reducing the use of electricity by saving energy and being more energy efficient.
- Adopting smart technology to make energy consumption more efficient.
- Expanding the renewable sources industry — such as solar, wind, and biopower.
- Shifting electric consumption to the evening whenever possible to lessen the strain of demand during the day.
Why Is Electricity More Expensive in the South of Sweden?
There are several reasons why southern Sweden has higher electricity prices than southern Sweden:
- The south used to depend mostly on nuclear power. When the plants were shut down, their independent electricity production was affected.
- Sweden has four electricity areas that transfer electricity between one another. However, there’s a transfer capacity — and prices start to increase when that capacity is reached.
- At least 90% of the country’s hydroelectricity production is in the north. As the previous point states, this means trying to transfer too much electricity from the north to the south is expensive.
- The electricity grid likely won’t grow in the next few years, which means price differences will stay the same.
Conclusion
We can truly say that the Swedish government is taking measures to lower the price of electricity — or, at least, lessen the blow for consumers.
After all, the country is pushing to move towards a greener system. Factors like energy taxes and tax reduction and exemption opportunities motivate people to follow suit.
