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Sweden pledges to compensate homeowners for record-high energy bills

Swedish ministers have announced plans to offer compensation for December, January and February's electricity bills. The compensation will be on a scale, based on households' energy usage.

Sweden pledges to compensate homeowners for record-high energy bills
Finance Minister Mikael Damberg and Energy Minister Khashayar Farmanbar in a press conference on Wednesday. Photo: Johan Jeppsson/TT

The highest level of compensation will be offered to those using more than 2,000 kWh per month, who will receive 2,000 kronor per month for three months – a total of 6,000 kronor. The proposal is a response to record-high energy bills hitting users across Sweden this winter.

The cash boost will primarily affect house owners, explained Finance Minister Mikael Damberg in a press conference alongside Energy Minister Khashayar Farmanbar.

“Not everyone will get compensation. Generally those with detached homes or small homes which are heated by electricity will be covered by this proposal,” Damberg said.

Compensation will be paid out to households with high electricity bills automatically, the government explained, although it will take a few months to come into effect.

“This will take a few months to be introduced,” Damberg said. “You can’t count on getting a lower energy bill in January, February – our proposal can’t make that possible.”

When asked about when homeowners could expect to receive compensation, Farmanbar responded: “We need to talk to electricity companies, authorites and parliament – but I think it will be a few months before we can give a clear answer on what exactly this will look like.”

“We believe it is important that compensation goes to those who really need it,” he continued.

Ministers were unable to give details on what the lower limit of compensation will be at this time, only that it will be offered on a sliding scale, with the maximum level of compensation offered to households using more than 2,000 kWh per month.

Damberg underlined the fact that it is extremely unusual for the state to compensate individual households for market price fluctuations.

“This is an exceptional measure for an exceptional situation,” he said. “We have extremely high energy prices in Sweden and Europe at the moment. The government takes this situation very seriously.”

Have you been affected by Sweden’s record-high energy bills? Get in touch with our editorial team at [email protected].

Member comments

  1. so if you save the electricity you don’t get compensation, but if you live in luxury house and use more energy, you get money. so we use the tax from people including poor ones to compensate rich ones.
    can’t understand the proposal. the compensation should come to each KWH the people used.

    1. I think they’re trying to focus on houses with electrical heating. If you don’t have central heating, you can’t avoid having high electricity bills. Since usually electrical heating takes most of the usage as it’s constantly working. Heating is not optional. Everyone else can save electricity by using less.

  2. “Sweden Pledges”? No “The socialist minority government decided that the Swedish taxpayer would ……”

  3. Let’s get some perspective on how expensive it is right now for us living in houses… My December bill was 1.5x that of my mortgage payment for the month. Another comparison is that it cost 500% more than for the same amount of electricity usage in December a year ago. 2000sek refund is nice, but it still means my final bill will be 400% higher than December a year ago.
    The primary issue is the tax. Every month, the tax ends up costing more than the cost for the energy itself. Worse still is the tax levied on the connection to the grid… that too is based on consumption, as if the more energy you use, the more wear and tear on the cable into your home!… It’s utter nonsense!
    I still believe that they should remove this connection tax and replace it with a flat tax that everyone pays from their salary – exactly as they did with the TV and Radio fee.

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BREAKING

Sweden to set aside 30 billion kronor to lower energy bills

The Swedish government wants to introduce 'high-price protection' to lower energy bills, with state-owned energy authority Svenska Kraftnät setting aside at least 30 billion kronor of energy profits to do so.

Sweden to set aside 30 billion kronor to lower energy bills

“Today we have a very important message,” Prime Minister Magdalena Andersson said in a press conference announcing the measures.

“We want to introduce high-cost protection for current high energy prices,” she said.

She blamed energy prices on Russian President Vladimir Putin and his war on Ukraine.

“We’re not going to let Putin hold Swedish households and businesses to ransom,” she said.

Svenska Kraftnät, a state-owned energy authority, expects to have funds of around 60 billion kronor in so-called “bottleneck income” next year.

The government wants those funds to be returned to households and businesses, with Svenska Kraftnät ordered to pay at least 30 of the 60 billion kronor back to households.

It will be up to the authority to determine how the money will be given back to consumers. According to the government, it could be used to lower energy market prices, but could also be given to consumers as direct compensation.

The goal is to provide more compensation to those companies and households hardest hit by high energy prices, meaning that the measures are likely to be aimed towards households and companies in southern Sweden.

It’s not yet clear when repayment will occur, but Energy Minister Khashayar Farmanbar said the government wants it to be “as soon as possible”. Compensation for last winter’s high energy prices was proposed in January and paid out four months later.

“It’s a repayment of those fees households and businesses have already paid, which we believe they have the right to,” Finance Minister Mikael Damberg said.

Svenska Kraftnät owns the main grid responsible for transporting electricity between different parts of Sweden. The 60 billion kronor bottleneck revenue Svenska Kraftnät is expected to earn by the end of next year is financed by so-called capacity fees paid by power companies and regional grid owners.

“Svenska Kraftnät are not supposed to be collecting piles of money,” Damberg said.

Capacity fees are levied when there are price differences between different parts of the country due to deficiencies in transmission capacity. Recently, those revenues have become unexpectedly high.

The EU’s electricity market regulations determine how the money can be used, for example, for investments, repairs, maintenance or lowering grid tariffs.

During the spring, the government has been in contact with the European Commission, which has now announced that governments may use the funds for emergency measures to benefit households and businesses.

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