Sweden’s offshore wind sector has received government approval for two new projects in the Bothnian Sea and the Skagerrak, with a potential combined production of almost 19 terawatt-hours of electricity a year. However, the companies behind both wind farms say that current market conditions may prevent construction without some form of public financial support.
The government approved Fyrskeppet Offshore, located in the southern Bothnian Sea, and Vidar, a floating wind project planned for the northern Skagerrak. The decisions were announced on 16 July after the government completed its assessment of all offshore wind applications under consideration in Sweden’s exclusive economic zone.
Eleven other offshore projects were rejected, mainly because the government concluded that they would have an unacceptable effect on Sweden’s defence capabilities.
Two offshore wind farms could produce almost 19 TWh
Fyrskeppet Offshore is planned around 54 kilometres east of Söderhamn. The government’s permit allows up to 93 wind turbines, which are expected to produce between 8 and 11 TWh of electricity annually.
The project is owned by Skyborn Renewables. Its planned output would be equivalent to a significant share of the electricity currently consumed in the Stockholm metropolitan area.
Vidar would be built around 35 kilometres south-west of Strömstad, close to Sweden’s border with Norway. The project may include up to 75 floating wind turbines and produce as much as 7.8 TWh each year.
Floating turbines can operate in deeper waters where conventional turbines fixed to the seabed are more difficult to install. Vattenfall owns a majority stake in the Vidar project.
Together, the two wind farms could generate up to 18.8 TWh of electricity per year. Sweden produced around 170 TWh of electricity in 2025, meaning the projects could eventually represent more than one-tenth of the country’s current annual generation.
Under the permits, both projects must be completed by 2036. Developers will also need further authorisations, including permission to install submarine cables connecting the wind farms to Sweden’s national electricity grid.
Developers say the projects need state support
Despite welcoming the permits, both companies questioned whether the projects are currently financially viable.
Vattenfall said that “the conditions for investments in offshore wind in Sweden are currently lacking”. Skyborn Renewables made a similar assessment and argued that offshore wind should receive support comparable to the mechanisms offered to new nuclear power projects.
Possible measures could include risk-sharing arrangements, favourable state-backed loans or guaranteed electricity prices.
The government has introduced a financing model for new nuclear reactors that includes state loans and contracts designed to provide investors with more predictable revenues. Offshore wind developers argue that high construction costs, interest rates and uncertainty over future electricity prices create similar investment risks for their projects.
Minister for Climate and the Environment (klimat- och miljöminister) Romina Pourmokhtari rejected the comparison. She argued that the companies’ decision to submit applications demonstrated that the projects had economic potential without direct taxpayer funding.
According to Pourmokhtari, nuclear power requires a different form of state support because it can provide dispatchable electricity, meaning that production can be adjusted according to demand. Wind generation depends on weather conditions and cannot provide the same level of predictability.
Several offshore wind projects previously approved by the current government have not yet entered construction. These include Kattegatt Syd and Galene in the Kattegat, as well as Poseidon in the southern Skagerrak.
Defence concerns blocked eleven applications
The government rejected eleven applications covering projects in the Gulf of Bothnia, the Bothnian Sea and waters off Sweden’s western coast.
The rejected projects include Eystrasalt Offshore, Polargrund Offshore, Mareld and Västvind. The government said they could have caused an unacceptable impact on Sweden’s defence capability.
Wind turbines can interfere with military radar systems and surveillance operations. The issue has become particularly sensitive since Russia’s full-scale invasion of Ukraine and Sweden’s accession to NATO.
In November 2024, the government rejected 13 offshore wind projects in the Baltic Sea after the Swedish Armed Forces (Försvarsmakten) warned that they could make it more difficult to detect missiles, aircraft and vessels approaching Swedish territory.
The latest decisions show that defence considerations remain a central obstacle to the expansion of offshore wind, particularly in strategically important parts of the Baltic Sea and along Sweden’s northern coast.
Sweden plans a new auction system for offshore wind
Sweden currently uses an open application model. Developers can apply to build wind farms in areas of their choice, but they have no guarantee that the selected location will eventually be considered suitable.
The government wants to replace this process with an auction-based system. Under the proposed model, the state would first identify suitable offshore areas after considering defence, shipping, fishing and environmental interests.
Energy companies would then compete for the right to develop projects in those areas.
Pourmokhtari said the new model would provide earlier decisions, greater predictability and better conditions for a faster expansion of fossil-free electricity production.
The government stressed that the rejection of the eleven current applications does not permanently exclude those maritime areas from future development. Some could be reconsidered after the auction system is introduced.
The approvals therefore expand Sweden’s potential offshore wind capacity, but they do not guarantee that new turbines will be built. The next stage will depend on whether developers, the government and electricity buyers can establish a financing model capable of turning the permits into operating wind farms.
