International promoter of nuclear power World Nuclear Association has revealed the Government of Sweden has decided to abolish its nuclear capacity tax on existing reactors, as well as establishing new reactors to replace traditional ones.

Nuclear capacity tax had risen to more than double staff costs and more than a third of operating costs.

The association’s director general Agneta Rising said: "It is excellent news that this tax will be removed, but it should never have been implemented in such a way as to distort the market and put at risk the operation of Sweden’s nuclear power plants, which provide affordable and reliable electricity and form a vital part of its low carbon generation mix.

"The tax should never have been implemented in such a way as to distort the market and put Sweden’s nuclear power plants at risk."

"Today’s announcement is a positive development. It is vital that there is now consistent policy to give operators the confidence to make the investments needed in their plant to allow for their long-term continued operation.

"Other countries should follow Sweden’s example and ensure that their energy policies provide a level playing field that treats all forms of generation equally on their merits."

Sweden’s nuclear energy sector has so far undergone a number of policy changes. A phase-out policy from 1979 was partially reformed by a new energy policy in 1997, which enabled extended operation of its reactors. Again in 2010, a new policy was agreed, which facilitated the construction of new plants in the country.

However, over the last eighteen months, policies promoted by the junior coalition Green Party saw significant increases in nuclear tax.