Sweden threatens to cut power exports to neighbours

Sweden has threatened to restrict electricity exports to neighbouring countries if a dispute with the European Commission over the use of energy fund revenues is not resolved. Deputy Prime Minister and Energy Minister Ebba Busch confirmed that Stockholm could take ‘drastic measures’ if the disagreements persist.

Such a move could affect electricity markets across northern Europe. Sweden exports surplus power from nuclear, hydropower and renewable sources through interconnection cables to several neighbouring countries, including Germany, Denmark and Finland.

Busch acknowledged that one option under discussion is to limit electricity flows through existing cross-border transmission lines.

The dispute centres on a European Union proposal requiring that 25 per cent of revenue from electricity grid congestion charges be used to finance cross-border energy projects supported by the bloc. Such revenues arise when grid constraints prevent electricity from being transmitted to areas with higher demand.

Sweden has significant hydropower resources in the north, while electricity supply is more limited in the south. The imbalance generates substantial income from grid congestion charges. In 2025, the Swedish transmission system operator collected around €2.8 billion in such revenues.

The European Commission said it is prepared to negotiate amendments to the proposal with member states.

(Reuters, Max)