What Can Serbia Learn from Sweden’s Energy Transition Model?

Today, the energy transition is no longer a matter of choice but a necessity for all countries seeking to ensure long-term energy security, economic competitiveness, and sustainable development. Over the past several years, Serbia has made significant progress in the development of renewable energy sources. However, the experience of countries that have advanced further in this process shows that the real challenge still lies ahead: how to ensure that the energy system remains stable, flexible, and reliable as the share of wind and solar power continues to grow.

This is precisely why the study visit to Sweden, organized within the framework of a project supported by the Government of Sweden, provided a valuable opportunity for representatives of Serbian institutions, energy companies, and the expert community to gain first-hand insight into solutions already being implemented in one of Europe’s leading countries in the energy transition.

What particularly distinguishes the Swedish approach is the fact that the energy transition is not viewed as a collection of individual projects but rather as a long-term process that connects energy, urban planning, transportation, environmental protection, industry, and digitalization. This integrated approach has enabled Sweden to simultaneously reduce greenhouse gas emissions, improve energy efficiency, and maintain a high level of energy supply security.

For Serbia, one particularly important topic is the flexibility of the power system. As the number of wind and solar power plants increases, so does the need for new mechanisms that enable the balancing of electricity generation and consumption. During the visit, we had the opportunity to learn about Sweden’s experience in developing flexibility markets, aggregators, battery storage systems, and digital tools for grid management. Particularly noteworthy is the growing role of battery storage facilities in balancing the system, whereas these services were previously provided primarily by hydropower plants.

One of the key messages we bring back from Sweden is that renewable energy sources cannot be considered separately from grid development and energy storage capacities. The energy transition requires new investments in infrastructure, but also the development of market mechanisms that enable more efficient use of existing resources. This is why aggregators, active consumers, energy communities, and various energy-sharing models between producers and consumers are becoming increasingly important.

Particularly inspiring were the examples of sustainable urban development in Stockholm. Former industrial areas have been transformed into modern neighborhoods based on energy efficiency, renewable energy, green infrastructure, and sustainable mobility. Projects such as Stockholm Royal Seaport demonstrate how long-term planning and public-private cooperation can create urban environments that simultaneously promote economic growth and reduce environmental impact.

Another interesting example is Sweden’s development of models in which waste heat from data centers is utilized in district heating systems, while battery storage facilities are integrated into urban energy systems. Significant efforts are also being invested in carbon capture and storage technologies, as well as in the implementation of circular economy principles. These examples demonstrate that the energy transition is not merely about replacing one energy source with another, but about fundamentally transforming the way we produce, distribute, and consume energy.

Another important lesson from Sweden concerns the role of nuclear energy in the energy transition process. Contrary to the often-simplified view that the energy transition relies exclusively on renewable energy sources, the Swedish approach demonstrates that long-term energy security is built upon a combination of different technologies.

Today, Sweden sees its energy future resting on three key pillars: hydropower, wind power, and nuclear energy. The combination of stable generation from nuclear power plants, the flexibility of hydropower, and the growing contribution of wind energy forms the foundation of its future electricity system.

After years of stagnation in nuclear development, Sweden has once again turned its attention to the construction of new nuclear power plants. The government has set a target of developing approximately 5,000 MW of new nuclear capacity and has designed a dedicated support model that combines favorable state-backed loans and Contracts for Difference (CfDs) to reduce investment risk and ensure long-term revenue predictability. The proposed model is open to both private investors and state-owned companies, while investors themselves propose project locations in accordance with strict regulatory, safety, and environmental requirements.

This approach provides an important confirmation that the energy transition does not require choosing between nuclear energy and renewable energy sources, but rather leveraging their complementarity. It is therefore significant that Serbia has also initiated activities to explore the development of a nuclear energy program while continuing to expand renewable energy generation. Sweden’s experience demonstrates that a combination of nuclear power, renewable energy sources, grid development, and energy storage can represent one of the most effective pathways toward a sustainable, secure, and competitive energy system in the long term.

Equally important for Serbia are the lessons related to the regulatory framework. Sweden’s experience confirms the importance of long-term Power Purchase Agreements (PPAs), the development of balancing markets, clear rules for aggregators, and incentives for energy storage investments. These are all areas that will become increasingly important for the Serbian market as the number of renewable energy projects continues to grow.

At the same time, Sweden’s experience shows that the success of the energy transition does not depend solely on technology. The quality of institutions, a predictable regulatory framework, coordination among different sectors, and continuous investment in knowledge and innovation are equally important. In every institution we visited, we observed strong cooperation among government bodies, businesses, research centers, and local authorities, which is a key prerequisite for the successful implementation of ambitious energy goals.

Serbia is now entering a new phase of its energy transition. In the years ahead, we can expect significant growth in renewable energy capacity, the development of new market mechanisms, and further modernization of the electricity system. This is precisely why the experiences of countries such as Sweden are particularly valuable. They demonstrate that the energy transition is not an end in itself, but rather a means of creating a more secure, resilient, and competitive energy system that supports economic development and improves citizens’ quality of life.

The task of all of us involved in shaping energy policy is to adapt these experiences to local circumstances and seize the opportunity to transform the energy transition into one of Serbia’s key development drivers in the decades to come.