• Rolls-Royce SMR (RR.L) selected as a leading candidate for Sweden's nuclear expansion, with utility Vattenfall (VEEV) evaluating small modular reactors as part of the country's fossil-free energy goals.
  • The selection underscores Sweden's renewed policy momentum toward nuclear power, aiming for net-zero emissions by 2045 while meeting rising electricity demand.
  • Rolls-Royce's SMR technology is positioned as a first-mover in the European market, pending regulatory milestones in the UK and Sweden.

Sweden’s energy strategy took a decisive turn on Thursday as state-owned utility Vattenfall selected Rolls-Royce SMR as a preferred partner for developing new nuclear capacity, according to people familiar with the matter. The choice marks a key milestone in Sweden’s bid to expand its nuclear fleet, which had been dormant for decades, and aligns with government targets to decarbonize the grid by 2045.

The decision follows a competitive tender process that also included GE Vernova (GE) and other SMR developers. Rolls-Royce SMR’s design, which has already advanced through early regulatory assessments in the UK, was seen as offering a lower-risk pathway to deployment, people close to the process said. Vattenfall declined to comment on the selection, while Rolls-Royce confirmed its participation in ongoing discussions but did not confirm a formal agreement.

“Sweden is a key market for our SMR technology,” said a Rolls-Royce spokesperson, adding that the company is “committed to working with regulators and utilities to bring clean, affordable nuclear power to the country.” The proposed project could see three reactors co-located at an existing site, such as Ringhals, delivering up to 1,500 MW of capacity, depending on final design and approvals.

The move comes as Sweden updates its nuclear legislation to permit new builds at more sites, a reversal of a long-standing policy that had limited expansion. “We are seeing a fundamental shift in how nuclear is viewed,” said Andrea Valeri, chairman of Blackstone in Italy, speaking on the sidelines of a conference. “Regulatory stability is key, and Sweden is providing that clarity.”

While the selection of Rolls-Royce is a significant step, final investment decisions remain contingent on regulatory milestones, including Step 2 and Step 3 approvals from the UK Office for Nuclear Regulation, which are expected in the next 12 to 18 months. Without a deal, Sweden would have to rely on other technologies or extend the life of its existing reactors to meet growing demand.

*Correction: An earlier version of this article misstated the number of reactors under consideration. The total potential capacity from three units is approximately 1,500 MWe, not 2,800 MWe.