Sweden plans 'massive' expansion of nuclear energy

Friday, 17 November 2023

In October last year, Sweden's incoming centre-right coalition government adopted a positive stance towards nuclear energy, with the Christian Democrats, the Liberals, the Moderates and the Sweden Democrats releasing their written agreement on policies - referred to as the Tidö Agreement. With regards to energy, the agreement said the energy policy goal is "changed from 100% renewable to 100% fossil-free". In the Tidö Agreement, it is assumed electricity demand of at least 300 TWh in 2045, double the current demand.

The agreement also said necessary regulations should be developed to create the conditions for the construction and operation of small modular reactors (SMRs) in Sweden. In addition, the permitting process for nuclear power plants must be shortened.

In January this year, a formal proposal to amend Sweden's legislation on nuclear power was presented by Prime Minister Ulf Kristersson and Climate and Environment Minister Romina Pourmokhtari. It aims to remove the current law limiting to 10 the number of reactors in operation, as well as allowing reactors to be built on new sites, rather than just existing ones. The proposed legislative amendments were open for consultation for three months. The government made a final decision on 28 September to introduce the bill to parliament. The changes to the law are proposed to enter into force on 1 January 2024.

The government has now presented a roadmap for new nuclear power in Sweden, which it says "clarifies the government's target and provides long-term conditions for new nuclear power".

The roadmap includes an in-depth agreement on four points.

Firstly, it calls for the government to appoint a nuclear power coordinator who will support the work of removing obstacles, facilitating and promoting new nuclear power. In addition, the coordinator will identify the need for additional measures. An important role for the coordinator will be to gather all relevant parties to get a clear direction for effective expansion.

Secondly, the state's financial responsibility needs to be clarified through a risk-sharing model. The government has previously proposed that government credit guarantees for SEK400 billion (USD38 billion) be introduced for nuclear power. However, the government has assessed that these credit guarantees alone will not be enough to stimulate new production. In order to strengthen the conditions and provide additional incentives to invest in nuclear power, an investigator must propose a risk-sharing and financing model where the state shares the risk.

The government has instructed the National Debt Office to take preparatory measures to be able to issue government credit guarantees for investments in new nuclear power. The National Debt Office must assist the Ministry of Climate and Business in the work of designing the detailed regulations for the credit guarantees. As part of the assignment, the National Debt Office must make an assessment of how credit guarantees for investments in new nuclear power affect the risk in the combined guarantee portfolio.

Thirdly, the new policy will make it possible for new nuclear power with a total output of at least 2500 MWe to be brought online by 2035 at the latest.

Fourthly, it paves the way for a "massive expansion of new nuclear power by 2045". "Given the long-term needs for fossil-free electricity until 2045, an expansion is needed that could, for example, correspond to ten new large-scale reactors," the government said. It noted that the exact amount and type of reactors needed "depends on several things, including the need and rate of expansion in the electricity system, technological development, and where in the country new consumption and production are located".

"We are now delivering a pearl string of decisions to pave the way for new nuclear power," said Deputy Prime Minister and Minister for Energy, Business and Industry Ebba Busch. "Sweden is laying the foundations to become a leading nuclear power nation again and a power factor for the green transition in the West."

Finance Minister Elisabeth Svantesson added: "New nuclear power is necessary for a stable and reliable energy system, for both consumers and businesses. It is therefore natural that the state will have to take a large financial role in terms of the expansion. The last few years have shown how expensive it is not to build nuclear power."