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🇸🇪 Sweden /Energy & Infrastructure

Sweden faces historically high electricity prices amid 'perfect storm' of factors

From Svenska Dagbladet · () Swedish

Translated from Swedish, summarized and contextualized by DistantNews.

At a glance

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  • Electricity prices in Sweden have reached historically high levels this summer, second only to the 2022 crisis, with June and July spot prices surging between 150% and 1,400% year-on-year.
  • Analysts attribute the surge to a "perfect storm" of factors including slowly replenishing hydropower reservoirs, reduced nuclear power availability, and indirect global impacts from gas price volatility and high European demand due to extreme heat.
  • Consumers with variable or hourly pricing face the highest costs during morning (7-9 AM) and evening (5-9 PM) peak hours, and experts warn that elevated prices are expected to continue through the rest of the year.

Sweden is experiencing unusually high electricity prices this summer, with figures from price comparison site Elskling showing June and July spot prices were the second highest ever recorded, surpassed only by the 2022 energy crisis.

Hydropower reservoirs are refilling very slowly, leaving them poorly stocked in both Sweden and Norway. Nuclear power has been undergoing maintenance, and this year has been particularly strained.

— Krisztian HorvathKrisztian Horvath, an electricity price analyst at Elskling, explained the factors contributing to the high electricity prices.

Compared to the previous year, spot prices in June alone were 150% to 1,400% higher. Krisztian Horvath, an electricity price analyst at Elskling, described the situation as a "perfect storm" driven by multiple converging factors. "Hydropower reservoirs are refilling very slowly, leaving them poorly stocked in both Sweden and Norway," Horvath explained. "Nuclear power has been undergoing maintenance, and this year has been particularly strained."

Global factors also play an indirect role. Uncertainty surrounding the Strait of Hormuz affects international gas prices. Additionally, extreme summer heat across Europe has significantly increased electricity demand on the continent. "Cooling doesn't directly affect Swedish consumers as we don't have air conditioning to the same extent," Horvath noted. "But because we are connected to all of Europe, we are indirectly affected by what happens there. All the cooling they are running indirectly impacts our prices."

Because we are connected to all of Europe, we are indirectly affected by what happens there. All the cooling they are running indirectly impacts our prices.

— Krisztian HorvathKrisztian Horvath, an electricity price analyst at Elskling, described how European energy demand affects Swedish prices.

For consumers with variable or hourly electricity contracts, prices are highest between 7 AM and 9 AM, and again from 5 PM to 9 PM. Horvath advised consumers to be prepared for continued high prices throughout the remainder of the year. "There will be elevated levels for the rest of the year," he stated, adding, "The advice we can give is to compare and not blindly trust that your current electricity contract is the best. You shouldn't be loyal."

There will be elevated levels for the rest of the year. The advice we can give is to compare and not blindly trust that your current electricity contract is the best. You shouldn't be loyal.

— Krisztian HorvathKrisztian Horvath, an electricity price analyst at Elskling, advised consumers on managing high electricity prices.
DistantNews Editorial

Originally published by Svenska Dagbladet in Swedish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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