While Sweden‘s electricity capacity is set to grow at a CAGR of 2.9% between 2025 and 2035, a lack of transmission capacity between the north and south of the country could limit the benefits of additional renewable generation, GlobalData has said.
According to GlobalData‘s report, Sweden Power Market Trends and Analysis by Capacity, Generation, Transmission, Distribution, Regulations, Key Players and Forecast to 2035, renewable energy will account for an ‘increasing share’ of the country’s power generation over the next decade, led by wind and solar, and supported by hydro and nuclear.
Starting point
“Sweden starts from a strong position, with hydro and nuclear power providing a largely fossil-free electricity base and wind power supplying much of the incremental growth,” said Attaurrahman Ojindaram Saibasan, power analyst at GlobalData.
“The next phase of the market will be shaped by demand as much as supply. New electricity-intensive industrial projects, including fossil-free steel, battery manufacturing, hydrogen production, and data centres, are increasing the importance of reliable power delivery in the locations where demand is emerging.”
Grid connections
While investment in renewables is ongoing, a ‘geographical mismatch’ threatens to curtail progress. As GlobalData noted, the north of the country boasts significant hydropower and wind resources, while much of the population, industrial activity and electricity consumption is concentrated in the south.
“Grid investment is a critical enabler of Sweden’s power transition,” Saibasan added. “Without faster delivery of transmission upgrades, northern clean power surpluses may be curtailed or exported while southern industrial users face tighter supply and elevated price volatility.
“[Grid operator] Svenska Kraftnät’s transmission expansion plans will therefore be as important as generation investment in determining whether Sweden can convert its resource advantage into dependable, competitively priced electricity.”
As GlobalData noted, offshore wind represents another potential source of additional capacity, however realising this potential depends on progress in maritime spatial planning, defence approvals, environmental assessments, seabed access, and grid connections.
“Sweden has the generation resources, industrial demand base, and market structure to remain one of Europe’s most important clean power markets,” said Saibasan. “Delivering that opportunity will require aligned decisions on permitting, grid reinforcement, offshore wind development, and the financing framework for new nuclear capacity.” Read more here.
