Electricity at Any Price? The Real Cost of Wind Power 

This policy brief critically evaluates the current push for extensive wind power expansion in Sweden. This Policy Brief critically examines the economic and technical assumptions behind the rapid expansion of weather-dependent energy sources such as wind and solar, identifying several systemic risks and shortcomings.

Key Findings

1. System Stability Risks

• A high share of intermittent power (currently 25% wind and 2.5% solar) threatens grid reliability.
• Essential system functions (instantaneous power, frequency control, reactive power, inertia) are inadequately supported by wind power, which increases the risk of blackouts and requires costly backup systems.
• Increased reliance on long transmission networks and synthetic grid stabilization adds cost and complexity.

2. Economic Inefficiency

• The Levelized Cost of Electricity (LCOE) used to justify wind expansion omits key system costs such as balancing, transmission, and profile costs.
• Studies show that beyond a 20% market share, wind power integration costs escalate rapidly.
• Studies indicate that Swedish wind power producers have faced persistent financial challenges, with average revenue levels falling below production costs by approxi mately SEK 0.35 per kWh over recent years.

3. Inadequate Compensation for Negative Externalities

• Property value losses, local disturbances, and environmental impacts are significantly undercompensated or ignored.
• Estimated real externalities (e.g., reduced property values) could exceed SEK 100 billion (approx. EUR 8.5 billion), mainly due to falling property values near wind farms.
• Battery storage as a balancing solution is economically and environmentally infeasible at scale.

4. Environmental and Sustainability Concerns

• Wind power requires vast land, strategic minerals, and results in higher carbon footprints than assumed.
• Waste from turbines and solar panels lacks proper disposal planning.
• Sustainability claims often ignore the Brundtland Commission’s three pillars (environmental, economic, and social).

5. Overstated Demand Projections

• Contrary to growth forecasts, electricity consumption has declined due to high prices and limited grid connection capacity.
• The 300 TWh/year demand projection is not aligned with current trends and system capabilities.

6. Policy Recommendations

• Reassess the rapid expansion of wind power by considering full system and social costs.
• Strengthen investment in nuclear power and, in the short term, supplement with gas power.
• Require more rigorous, independent environmental impact assessments and integrate precautionary principles.

Conclusion

The current energy trajectory in Sweden, with a growing reliance on intermittent energy sources, appears to rest on optimistic assumptions regarding costs and system integration. A more comprehensive evaluation of alternative strategies may be warranted. It calls for a shift toward more reliable and sustainable energy strategies, especially nuclear, and a reevaluation of what constitutes a truly sustainable energy policy. Decision-makers need to base energy policies on empirical evidence and holistic system analysis, not on idealized economic models that underestimate the real-world cost and system impact of energy choices.

—Skandinaviska Policyinstitutet, May 2025

Download original document: “Electricity at Any Price? The Real Cost of Wind Power”

Download Swedish original: “El till varje pris? Vindkraftens verkliga kostnader”