Electricity Congestion Charges Double in Sweden, Burdening Southern Consumers

Electricity congestion fees in Sweden have surged to over 24 billion SEK in 2025, effectively doubling from previous years and imposing significant financial strain on consumers in southern Sweden. This sharp increase is largely driven by widening price differences between the northern and southern regions, exacerbated by a newly implemented flow-based capacity calculation system introduced in October 2024.

The new system, designed to optimize electricity transmission by accounting for actual power flows instead of fixed capacities, has ironically led to higher congestion charges rather than reducing them. A study from Tampere University highlights that the system sometimes prioritizes maximizing congestion revenues over benefiting consumers and producers. It reveals that electricity often flows from the more expensive Svealand region to cheaper Finland, contrary to expectations. Electricity market analyst Mats Nilsson criticized the system, stating it results in unnecessarily elevated regional prices.

Svenska kraftnät, the Swedish national grid operator, currently holds 83 billion SEK in congestion income, collected due to price disparities between regions. This revenue is intended to fund improvements to the transmission grid, but critics point out that more money has been collected than has been reinvested. Mårten Bergman from Svenska kraftnät acknowledged the concerns raised by the study but emphasized that overall, the new system has increased transmission benefits, particularly from the north to the south.

While Svenska kraftnät's evaluation claims positive developments in north-to-south electricity transmission, consumers, particularly in southern Sweden, are indirectly bearing increased costs through these congestion fees. This situation raises concerns about the effectiveness and fairness of the current electricity transmission pricing mechanism as Sweden seeks to balance supply, demand, and grid capacity.