Electricity bills have not caused widespread anxiety in Sweden for some time now. Recent electricity prices have been significantly lower than the high rates experienced during the winter of 2022-2023. However, this relief is precarious.
The current weak electricity system, characterized by frequent power outages and insufficient predictable energy production, means prices could surge again. Nevertheless, the situation is relatively calm at present.
Despite these lower electricity prices, paying the bill remains a financial burden. Consumers have made significant efforts to reduce consumption by unplugging appliances like dryers, underfloor heating, and spare freezers. However, various fees and electricity taxes continue to inflate costs. In many cases, these additional charges surpass the actual price of electricity itself. The Moderates’ election promises to reduce the electricity tax have been forgotten, as have their earlier proposals.
To compound the issue, electricity grid fees are skyrocketing for customers of multiple grid companies. Eon, for instance, has increased fees by 9% in and around the capital and 6% in southern Sweden. This follows earlier hikes of 12% and 6%, respectively. Vattenfall has also imposed a 12% increase, while Ellevio, a major grid owner, has joined the trend. Numerous smaller electricity companies have followed suit.
Consumers have no choice but to pay these exorbitant fees. The electricity market operates as a monopoly, forcing residents to contract with their local grid company for essential services, such as heating and lighting. Barring a return to wood stoves and candles, consumers are held captive. This monopolistic structure has enabled electricity companies to amass substantial profits. Profit margins and shareholder dividends are high, diverting funds crucial for network upgrades and expansion.
When electricity grids were deregulated, the Energy Markets Inspectorate (EI) was established to develop a pricing model and oversee grid companies. EI is tasked with shielding consumers from the monopoly's negative impacts by setting revenue caps.
Eon, Ellevio, Vattenfall, and other industry giants should not be permitted to charge beyond what is necessary for reasonable profits and network maintenance. However, this regulatory framework has proven ineffective. Despite multiple failed pricing models, EI has recently increased revenue caps for future years, disregarding insufficient network investments and excessive profits.
Fortunately, a government investigation last autumn proposed a solution. By clarifying EI's role and adjusting the revenue ceiling calculation to align with concrete post-construction costs, the government aims to prevent further price hikes. Swift implementation of these measures is essential.
The fact that electricity grid charges for a single-family home have doubled the average societal price increase over the past decade, while companies like Eon reap enormous profits, is unacceptable.