Sweden receives sixth state aid application for new nuclear power

The Swedish government has recently received its sixth state aid application for the construction of new nuclear reactors. Swedish Minister for Financial Markets Niklas Wykman stated that Nordic energy company Fortum's establishment of a project company in Sweden to advance new nuclear reactor plans demonstrates that Sweden's current state aid model has been carefully designed to accommodate project development needs.

The application was submitted by NuCore Energi, a newly established project company under Fortum, with the project site located at Ävrö near the Oskarshamn nuclear power plant. Wykman has previously expressed repeated support for expanding nuclear energy in Sweden, believing that new nuclear power is of significant importance for long-term economic stability, industrial competitiveness, and climate goals.

Under Sweden's current framework, state aid primarily consists of government loans and two-way contracts for difference. Government loans are used to reduce upfront financing risks and capital costs during the construction of new nuclear facilities; two-way contracts for difference provide a price hedging mechanism that offers minimum compensation when electricity prices fall below agreed levels and recovers excess revenue when market prices exceed the cap.

The Swedish government also supports covering up to 75% of construction costs through low-interest state loans, alleviating the pressure on the private market to bear the upfront capital risks of new nuclear projects alone. The state aid program has a capacity cap, covering a total installed capacity of approximately 5,000 MW across supported investment projects, equivalent to four large reactors.

Since the launch of the state aid program in August 2025, the Swedish government has received applications from Videberg Kraft, Blykalla, Studsvik ReFirm, Nordic Baseload Power, and NuCore Energi. Among these, Blykalla has submitted two applications covering small modular reactor and lead-cooled modular reactor projects.

In recent years, Sweden has adjusted its nuclear policy toward supporting the construction of new nuclear units. The country plans to add approximately 2.5 GW of new nuclear capacity by 2035, with project directions including large reactors and small modular reactors. Currently, Sweden operates six large commercial nuclear units across three sites: Forsmark, Oskarshamn, and Ringhals. According to International Atomic Energy Agency data, nuclear power accounted for approximately 29% of Sweden's electricity generation in 2024.