Sweden set to take on more of consumers’ soaring energy bills

STOCKHOLM (Reuters) – The Swedish government said on Wednesday it would probably have a bigger buffer than it had previously expected to take on some of the soaring energy costs of households and businesses this winter.

The government expects to have 90 billion crowns ($8.43 billion) available to help ease consumers’ pain of record electricity prices this year and next, Finance Minister Mikael Damberg told a news conference.

The Social Democrat government, which is facing general elections in September, earlier this month announced it would hand around 60 billion crowns ($5.6 billion) to cushion companies and households.

Damberg said grid operator Svenska Kraftnat now predicted its so-called bottleneck income, which will be used to cushion the bills, would be 30 billion crowns higher in 2022 and 2023 than it had forecast a few months ago.

“This means that the total support may be up to five times bigger than the support paid out during last winter’s electricity price compensation,” he said.

Bottleneck income comes from the operator’s management of power flows from geographical areas with different prices.

“Given (power market) prices are as high as they are we now see that we have further muscle in our high-cost protection scheme to meet an even worsening situation,” Damberg said.

($1 = 10.6767 Swedish crowns)

(Reporting by Anna Ringstrom; Editing by Bernadette Baum)

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