Swedish hydro power needs to be modernized in a way that creates the greatest possible benefit for both the environment and access to electricity. his translates into new requirements on operators who currently run hydro power plants, and the Hydroelectric Environmental Fund has been established precisely to support these operators.

Since Holmen joined as a co-financier in February 2023, the fund is financed by the nine biggest hydro power generators in Sweden. Together, the energy companies have contributed SEK 10 billion, which makes the fund the biggest environmental investment in Swedish waters ever.

“Hydro power is the backbone of Sweden’s fossil-free energy system, and a precondition for ensuring that Swedish industry remains competitive. By taking on the role of co-financer of the fund, we are lending our support to the agreement whereby the energy sector finances the transition to smart environmental adaptations. We are keen to promote the greatest possible benefit to society and the environment within the given framework,” says Fredrik Nordqvist, Senior Vice President, Renewable Energy. 

Support for hydro power owners

Hydro power activities are subject to authorisation, which means that operators need an environmental permit to run hydro power plants. The environmental code was amended on 1 January 2019 to include the requirement that all hydro power plants operate in accordance with modern environmental conditions. For this reason, all hydro power plants that have not already aligned with modern environmental requirements are to be reassessed in relation to the terms of the environmental code. The Land and Environment Court decides whether a given operation is to be reassessed, or whether a given permit is to be re-examined. The role of the fund is to provide support for hydro power owners throughout this process. 

The fund serves as a facilitator

"Numerous hydro power owners will need to invest time and money in adapting and modifying their facilities to ensure that they comply with the new requirements. In this context, the fund serves as a facilitator by providing financial backing and support in the form of resources and expertise,” explains Rikard Nilsson, Technical Manager at Holmen Renewable Energy and Holmen’s representative in the Hydroelectric Environmental Fund. 

“As both a major generator and consumer of fossil-free power, we are also committed to helping establish modern environmental conditions for hydro power in Sweden, through constructive dialogues between authorities and the business community. Here, it is a matter of carefully balancing regarding the adaptations that generate the greatest environmental benefit, as well as other benefits to society such as renewable electricity production and regulatory capacity in the electricity system.”


About the Hydroelectric Environmental Fund

  • The Hydroelectric Environmental Fund is a limited company tasked with financing environmental measures in the Swedish hydro power sector.

  • This must be done according to a national plan for re-examination of hydropower. The EU's framework directive for water and Swedish environmental quality goals also set goals for how Swedish hydropower is to become sustainable in the long term.

  • All operators who are subject to the national plan and who run hydroelectric operations in Sweden will be able to apply for financial compensation from the fund. The fund finances up to 85 per cent of the costs for examinations, having environmental measures reviewed in court and the actual implementation of such measures as are decided by the court. It can also pay compensation for any loss of production.

  • The objective is for all Swedish hydro power to be environmentally adapted, and for Sweden to benefit from even healthier watercourses with long-term sustainable ecosystems.

  • The Hydroelectric Environmental Fund website


The nine Swedish energy companies that finances the fund:






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