Electricity prices - Sweden SE2

Electricity Market in Sweden

Primary Sources of Electricity Generation in Sweden

Sweden’s electricity generation in 2025 remains dominated by low-carbon sources, chiefly hydropower and nuclear energy, with a growing contribution from wind power. The country has virtually eliminated fossil fuels from power generation (over 98% of electricity is now produced from clean, carbon-free sources). The table below summarizes the approximate energy mix by source:

Table: Estimated electricity generation mix in Sweden (2024 data, reflecting the situation in 2025). Sweden’s electricity is nearly fossil-free, with hydropower, nuclear, and wind together supplying the vast majority of output.

Hydropower has long been Sweden’s largest power source, leveraging the country’s abundant rivers. Nuclear power is the second-biggest source, providing reliable baseload generation (Sweden has three nuclear plants with a total of six reactors in operation). Wind power’s share has expanded significantly – from under 5% in 2010 to roughly 20–25% by the mid-2020s – as many new onshore and offshore turbines have been commissioned. Biomass-fueled combined heat and power (CHP) plants contribute a single-digit percentage (~5–10%), by burning biofuels or municipal waste to produce electricity (often alongside district heating). Solar power, while still a minor part of the mix (~1–2%), is growing rapidly each year due to falling costs and supportive policies, especially for rooftop installations. Notably, Sweden’s generation is almost entirely fossil-free, with coal virtually phased out and only minimal oil or gas generation used for peak load or grid stability. This clean generation profile enables Sweden to have one of Europe’s lowest carbon intensities for electricity.

Formation of End-User Electricity Prices

Electricity prices for end customers (households and businesses) in Sweden are composed of several components. In general, the total price a consumer pays is split into three main parts: (1) the electricity supply cost (the energy itself), (2) the network charge (grid transmission/distribution fees), and (3) taxes and levies. Below is a breakdown of these components and how they form the final price:

• Energy Production/Supply Cost: This reflects the cost of generating or procuring the electricity. In a competitive retail market, consumers can choose an electricity supplier, and the energy price is often linked to the wholesale market. For customers on variable contracts, the supply cost is essentially the Nord Pool spot market price (which fluctuates hourly or monthly) plus the retailer’s markup or fee. For fixed-price contracts, the supply cost is the agreed rate per kWh. This energy component typically accounts for roughly one-quarter to one-third of the total bill under normal market conditions (though the share can vary with market price swings). It is the portion of the bill influenced by competition between energy companies. Suppliers may also include the cost of mandatory green certificates in this part (see “Electricity Certificates” below).

• Grid Fees (Transmission & Distribution): These are charges for transporting electricity over the high-voltage grid and local distribution networks to the customer. Grid fees are regulated and set by regional network operators (e.g. Ellevio, E.ON Elnät, Vattenfall Eldistribution, etc.) under oversight of the Energy Markets Inspectorate (Energimarknadsinspektionen). They usually consist of a fixed monthly charge and a variable fee per kWh. The network fee covers maintenance of power lines, substations, and other infrastructure. On average, network charges make up roughly a quarter of a typical consumer’s electricity cost, though this can be higher in rural areas (where distribution costs are greater) and lower in dense urban areas. Customers generally cannot choose their grid company (it’s a local monopoly), but these fees are nationally regulated to a “reasonable” level.

• Energy Tax (Energiskatt): Sweden levies an excise tax on electricity consumption. As of 2025, the standard energy tax rate is 43.9 öre per kWh (0.439 SEK/kWh) for most consumers. This tax is imposed on all electricity usage and is adjusted annually. Notably, residents in certain northern municipalities pay a lower rate (a tax reduction of 9.6 öre/kWh) to compensate for colder climate and regional policy. The energy tax is a significant component of the price – it has increased steadily over time (more than tripling since the electricity market was deregulated in 1996). For an average household in 2025, the energy tax alone can represent roughly 20% or more of the total electricity bill. (Large industrial enterprises can receive partial exemptions or refunds under specific conditions, but ordinary businesses and homes pay the full rate.)

• Electricity Certificates: In Sweden’s electricity certificate system, suppliers must purchase renewable energy certificates corresponding to a proportion of the electricity sold, to support investment in renewables. Introduced in 2003, this quota system effectively adds a small cost to consumers. Initially, the elcertifikat charge was itemized on bills, but since 2007 it has been incorporated into the energy price by most retailers. The cost of certificates fluctuates with market price – often on the order of a few öre per kWh (for example, in early 2025 certificate prices spiked, but averaged roughly 0.5–1 öre/kWh in recent years). While not a tax (revenues go to renewable generators, not the state), the certificate fee is a mandated part of the electricity price structure. It ensures that a certain percentage of electricity comes from renewable sources.

• Value-Added Tax (VAT): A 25% VAT (moms) is applied on top of all the above components – essentially on the total of (energy + grid + energy tax + certificate fee). For residential customers, this VAT is a non-recoverable cost. For business customers, the 25% VAT is usually deductible (they can reclaim it as input VAT, since electricity is a business expense), meaning the effective cost burden of VAT falls on private consumers. VAT significantly increases the final price paid by households – for instance, the 43.9 öre/kWh energy tax effectively becomes ~54.9 öre/kWh after adding 25% VAT. In total, taxes (energy tax + VAT on everything) account for almost half of a typical household electricity price.

• Other Regulated Fees: There are a few small fees included in the price that fund certain authorities and system services. These are relatively minor (fractions of an öre per kWh) and often folded into the grid fee or overall tax. For example, there is an electrical safety fee (to fund the Swedish Electrical Safety Agency’s work), a fee to finance the Energy Market Inspectorate, and a charge to fund Svenska kraftnät (the TSO) for maintaining power system reliability and wartime preparedness. These add only marginally to each kWh’s cost, but they are part of the regulated structure of the bill.

Residential vs. Business Customers: The composition of the electricity price is similar for households and standard business consumers in 2025, with both paying the same network tariffs and energy taxes. The main difference is in VAT handling – businesses registered for VAT can deduct the 25% VAT, whereas households cannot, so the after-tax cost is effectively lower for commercial users (they pay the ex-VAT price). Additionally, certain energy-intensive industries or manufacturers may benefit from tax concessions (e.g. reduced energy tax rates or rebates) under Swedish and EU rules, but these do not apply to typical commercial or small-business customers. Location can also matter: a company or household in northern Sweden pays the lower energy tax rate as noted above. Overall, however, the structure of price components is the same for a household and a small business drawing power from the grid – both pay an energy price to their supplier, a grid fee to their network operator, energy tax and other fees, and 25% VAT on top of everything (with the business later reclaiming the VAT). This transparent breakdown is usually shown on the electricity bill, often split into an electricity trading invoice (for the energy supply portion) and a separate network invoice (for the grid access), along with tax details. In summary, by 2025 Swedish end-user electricity pricing is heavily influenced by taxes and policy costs – in fact, about 45–50% of a household’s electricity price consists of taxes and policy-driven fees, while the rest is roughly split between the market-based energy cost and the regulated grid fee.

Dynamic Electricity Tariffs: How They Work and Regulatory Framework

Dynamic electricity tariffs (in Swedish often called timprisavtal when based on hourly pricing) are pricing plans where the rate you pay for electricity varies in real time with the wholesale market price. Instead of a fixed price per kWh or a monthly averaged rate, a dynamic tariff directly reflects the Nord Pool spot price for each hour of the day. In practice, this means the electricity price is different every hour, following the ups and downs of the Nordic power exchange. When the market price spikes (for example, during a cold winter evening with high demand), a customer on a dynamic tariff pays a high rate for that hour; conversely, when there is surplus power or low demand (e.g. windy night with ample wind generation), the price drops and the customer benefits from very cheap electricity during those hours.

How dynamic pricing works: Customers with a dynamic contract must have a smart meter that records electricity consumption hour by hour (or at the market’s settlement interval). The retailer then bills the customer for each hour’s usage at the corresponding Nord Pool spot price for that hour (usually specific to the customer’s bidding zone, since Sweden is divided into four price areas SE1–SE4) plus the retailer’s fee or markup. For example, a company like E.ON offers an hourly tariff where the customer pays the actual Nord Pool spot price each hour plus a fixed add-on of a few öre per kWh and a monthly administrative fee. In essence, the consumer pays the true production cost of electricity in real time, bearing the market’s volatility: the rate can swing dramatically within a day. This creates an incentive for consumers to shift their consumption to cheaper periods – for instance, running a dishwasher or charging an electric car late at night when prices are low, rather than during the early evening peak. Studies indicated that active households can save 10–15% on electricity costs by adjusting usage to off-peak times under a dynamic tariff. However, customers also assume the risk of price spikes – there is no price cap, so if market prices surge (as seen during certain cold spells in 2022–2023), the hourly rates paid will likewise be high. Dynamic tariffs therefore suit consumers who are engaged and flexible with their electricity use.

Link to Nord Pool: The Nord Pool power exchange (day-ahead market) sets hourly spot prices for each delivery hour of the next day, based on bids from electricity producers and buyers across the Nordic and Baltic countries. Dynamic retail contracts are typically indexed to these Nord Pool spot prices. For example, if the spot price at 3:00–4:00 AM is 20 EUR/MWh (approximately 20 öre/kWh) in SE3 (Stockholm area) and at 17:00–18:00 PM it is 150 EUR/MWh (~150 öre/kWh), those are the raw prices a dynamic-rate customer in that zone would pay (with perhaps a small supplier surcharge). The retail supplier usually publishes the next day’s hour-by-hour prices (which are known each afternoon for the following day) in their app or website, so customers can see upcoming high or low price periods. Some modern suppliers’ apps will even automate usage shifts – for instance, smart thermostats or EV chargers that respond to price signals. Overall, the dynamic tariffs create a direct link between consumer usage and wholesale market conditions in real time. Notably, Sweden’s move toward a smarter grid enables this: by 2025 almost all households have smart meters capable of hourly (or quarter-hour) measurement, a prerequisite for true dynamic billing.

Regulatory framework in Sweden: The adoption of dynamic pricing is supported and regulated by law. In the EU, the Electricity Market Directive (EU 2019/944) requires member states to ensure that consumers with smart meters have the right to choose a dynamic price contract from their supplier. Sweden implemented these provisions in its national legislation (Ellagen). Since 1 June 2023, large electricity retailers in Sweden are obligated to offer contracts with dynamic pricing to customers who request them. Specifically, any supplier above a certain size (the EU directive sets this at suppliers with >200,000 customers) must have a dynamic tariff option available. The Swedish Electricity Act also formally defines “avtal med dynamiska elpriser” as an agreement where the price “reflects the prices on the spot markets at the frequency of market settlement”. At present, the market settlement frequency is hourly, but this is changing – Nord Pool is transitioning from hourly to 15-minute trading intervals in 2025, in order to handle finer fluctuations. Starting 11 June 2025, Nord Pool’s day-ahead and intraday markets will quote prices in 15-minute periods (“quarter-hour prices” or kvartspriser), and Swedish regulations consider only those tariffs that follow the market at this new interval to be fully “dynamic”. (After this change, traditional hourly spot contracts will be updated to 15-minute pricing to remain classified as dynamic.)

Importantly, Swedish law mandates customer consent for dynamic pricing. A new rule (effective June 2023) prohibits placing passive customers on a dynamic tariff without their explicit agreement. For example, the default “anvisat” contracts (automatic supply if one hasn’t chosen a vendor) are not allowed to have hourly rates, since a dynamic tariff could expose uninformed customers to volatile prices. Consumers must opt-in to a timpris (or soon kvartpris) contract, typically by actively signing up with a supplier that offers it. Additionally, suppliers must clearly inform customers about the nature of such contracts (e.g. that prices vary every hour/15 minutes) and provide tools or data access so customers can follow their usage and price signals.

Growth of dynamic tariffs: In Sweden, dynamic pricing has rapidly gained popularity, especially after the extreme price volatility in 2022. As of early 2025, a significant share of consumers have embraced this model. While the majority of households (about 58%) still have monthly variable contracts (where the price fluctuates with the market but is averaged over the month), fully dynamic hourly contracts have become more common than traditional fixed-rate contracts. In fact, the proportion of households on a timpris agreement in January 2025 slightly exceeded the total on fixed-term deals – indicating that dynamic tariffs have moved from a niche product to a mainstream option. This trend is encouraged by Sweden’s smart metering infrastructure and the expectation of long-term cost savings and more efficient energy usage. The government and regulators view dynamic pricing as a tool to increase demand flexibility, which can help balance the grid as more intermittent renewable energy (wind, solar) is added. Overall, dynamic electricity tariffs in Sweden are a well-established, legally supported option by 2025, offering consumers both opportunities for savings and exposure to real-time market conditions.

Major Electricity Providers with Dynamic Pricing Tariffs

Many electricity retailers in Sweden offer dynamic pricing contracts (spot price-based tariffs) by 2025. Below is a list of major providers and their offerings, noting whether they serve residential (household) and/or business customers:

• Vattenfall: Vattenfall AB – Sweden’s largest electricity producer and a major retailer – offers “timpris” spot-price contracts to both residential and business customers. As one of the dominant nationwide suppliers (state-owned), Vattenfall provides an hourly pricing option (often sourced from 100% renewable or fossil-free power) for households that have a smart meter. It also serves large commercial and industrial clients, although those may have bespoke contract terms. Vattenfall’s dynamic tariff lets customers pay the Nord Pool hourly rate plus a retail fee, and is supported by tools like smartphone apps to track prices.

• Fortum: Fortum (a Finnish-based energy company with a big Swedish retail customer base) offers dynamic pricing for both residential and business consumers. Fortum’s spot-price contracts allow household customers to tie their electricity cost directly to the hourly market price, viewable in Fortum’s mobile app in real time. Business customers (especially small/medium enterprises) can similarly opt for market-indexed pricing. Fortum has actively promoted these flexible contracts to encourage customers to shift consumption to cheaper hours, in line with its clean energy offerings.

• E.ON: E.ON is a large European utility that also operates in Sweden’s retail market. E.ON Sverige provides dynamic hourly price plans for households and businesses. Under E.ON’s “Timpris” contract, customers pay the actual Nord Pool spot price each hour, plus a fixed add-on of about 7.5 öre/kWh (incl. VAT) and a monthly fee. This plan is available to residential users (with services like an app to monitor hourly rates) and to business customers who prefer spot-indexed pricing. E.ON’s dynamic tariff is positioned for those who can adjust usage timing to save money. (For larger industrial clients, E.ON also offers advanced market-based contracts and energy management services.)

• Tibber: Tibber is a newer digital-only electricity provider (originally from Norway, now active in Sweden) that exclusively offers dynamic pricing. Tibber’s model is app-based and targets residential customers. Notably, Tibber has only one type of contract – a pure spot price hourly tariff – meaning all its customers pay the Nord Pool hourly price with no markup except a fixed monthly subscription fee. The Tibber app integrates smart home functions, allowing users to automate devices based on price signals. Tibber does not segment by business/residential in the traditional way; practically all its marketing is toward private homeowners, though a small business could use Tibber if it fits the profile (the service is geared toward individual electric meters rather than complex corporate procurement).

• Greenely: Greenely is a Swedish tech-oriented electricity supplier that, like Tibber, focuses on household customers with an app-centric approach. Greenely offers a “self-cost price” dynamic tariff, where consumers pay the hourly Nord Pool price without a per-kWh markup (Greenely instead charges a fixed monthly fee). All energy source costs, certificates, balance costs, etc., are passed through at cost. Greenely’s service is 100% app-based and provides smart analytics to help users optimize usage. It does not have traditional fixed-rate plans – its core offering is the spot-indexed pricing for residential users. (Greenely is primarily aimed at private consumers; it is not a traditional business supplier, although landlords or tenant-owner associations might use it for properties.)

• Bixia: Bixia is a mid-sized Swedish electricity retailer known for sourcing local renewable energy. It serves both household and business customers and offers a dynamic pricing option (hourly spot price contract) in addition to other contracts. Bixia’s hourly tariff lets customers pay spot price + a retail premium, and the company emphasizes buying electricity from regional wind, solar, and small-scale hydro producers. Both private customers and companies (especially in southern Sweden where Bixia is active) can choose this timpris deal. Bixia also provides tools for tracking when electricity is cheapest or most environmentally friendly.

• GodEl: GodEl is a unique retailer (operated by a non-profit foundation) that sells electricity with all profits to charity. It primarily serves residential customers. GodEl offers a dynamic pricing contract for households who want hourly rates. Its “Timpris” follows Nord Pool spot and will transition to quarter-hour pricing in 2025, as GodEl has informed its customers about the switch to 15-minute settlement. GodEl’s dynamic tariff is 100% renewable (guarantees of origin are included) and is popular among customers who value both price flexibility and the company’s philanthropic model.

(Note: In addition to the above, virtually all major Swedish electricity suppliers now have some form of dynamic pricing contract available by 2025, especially due to the legal requirement for larger companies to offer them. This includes other well-known providers such as Skellefteå Kraft (which serves both northern communities and nationwide customers with spot-based deals), Göteborg Energi (the city utility in Gothenburg, offering hourly price options to its customers), Värmevärden and numerous municipal energy companies across the country. The list above highlights a mix of the largest national players and innovative new entrants most commonly associated with dynamic tariffs in 2025.)

Peak and Off-Peak Hours

Sweden SE2 2024 – Average Hourly Wholesale Electricity Price (Nord Pool)