Does policy matter : A study on the Swedish energy policy with a focus on nuclear power

Sammanfattning

This master’s thesis examines the relationship between Swedish energy policy and its impact on the energy market, with a particular focus on the nuclear power sector. The central research question addressed is: "To what extent do political decisions influence the energy sector?" Through an in-depth analysis of historical data, policy frameworks, and market dynamics, the study investigates how political decisions shape the operational outcomes, (e.g. Real-life decision, running operations and investments) particularly concerning nuclear power in Sweden. The research is framed by a statement made by Sweden’s former Minister for Climate and Environment in 2022, which claimed that the decision to close reactors at the Ringhals nuclear power plant was driven solely by market forces rather than governmental policy changes. This assertion serves as a focal point for exploring the interplay between political decisions and market mechanisms (e.g. How the market behaves upon political decisions) in shaping energy outcomes. The thesis also delves into historical events related to nuclear power on a global scale and their influence on global public opinion and safety considerations within the nuclear industry and in particular how these opinions have been considered from a Swedish perspective. A comparative analysis with France is undertaken, as both Sweden and France embarked on ambitious nuclear energy programs during the same era (e.g. 1940s – 2020s). Despite their shared origins, the two countries have since taken markedly different paths in their nuclear policies where one keeps expanding and one shrinks their shares of nuclear, offering valuable insights into the role of political strategy in shaping energy systems. In addition to a literature review, the study incorporates interviews with key stakeholders in politics, industry, and academia. These interviews provide a deeper understanding of how policy decisions affect the nuclear energy sector and enrich the analysis with qualitative insights from individuals directly engaged with energy policy and its implementation. These interviews are essential for exploring the central research question—whether and to what extent policy influences the energy sector—by providing qualitative insights into how policy decisions are perceived and enacted in practice. The findings indicate that while market forces play a significant role, political instruments such as subsidies, regulatory frameworks, and taxation have been critical in shaping Sweden’s energy market. Nuclear power, as a contentious yet vital component of Sweden’s energy mix, continues to be influenced by a combination of political priorities and market dynamics. The study highlights how cohesive and predictable policymaking is essential for fostering long-term investments in nuclear power and supporting Sweden’s broader climate goals. Furthermore, the thesis identifies key challenges for nuclear energy in Sweden, including public skepticism, high costs, and regulatory hurdles. At the same time, it highlights opportunities such as the development of small modular reactors (SMRs), the potential for nuclearderived hydrogen, and nuclear energy’s ability to complement renewables in achieving climate neutrality. By examining the intricate relationship between political decisions and market forces, this thesis contributes valuable insights to the academic discourse on sustainable energy governance. The findings underscore the need for strategic and balanced policymaking to ensure a secure, sustainable, and economically viable energy future for Sweden. The findings have broader relevance for countries facing similar challenges in balancing energy security, sustainability, and market efficiency.