Temporary revenue cap on electricity in force

by Ebba Perman Borg, Victor Elovsson and Maria Ström


Solar panels in a storm

On 22 February 2023, the Swedish Parliament voted in favour of the previously published proposal (prop. 2022/23:58) regarding a temporary revenue cap on electricity through a tax on excess income (please see our newsletter from 10 January 2023 regarding the proposal and the EU Regulation 2022/1854 on which it is based).

The revenue cap will be implemented through a new act, the “Excess profits from electricity tax act”, with the purpose of lessening the effects of the ongoing energy crisis. As previously proposed, the excess profits tax will be levied at a rate of 90% on profits above SEK 1,957 per MWh.

The new act will be applied on electricity that is produced during the period March–June 2023. As such, the revenue cap and excess profits tax is temporary and will not be applied retroactively. It is estimated that the excess profits tax will strengthen the public finances with approximately SEK 150 million.

The new rules entered into force on 1 March 2023.

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