Sweden and Norway has numerous political, cultural and physical similarities, which include a common history, a common electricity market, similar political systems, similar climates and large potentials for renewable energy production. Still, Sweden has the last two decades by far outpaced Norway in increasing production of renewable energy. This is particularly striking regarding wind energy, geothermal energy and biomass energy. What can explain these large differences? Through employing a historic comparative analysis with a most similar systems design combined with institutional theory, this paper finds several contributing factors. First, the energy potentials differ in the two present major technologies. Norway has by far the largest potential for building out hydro power, which also on average provide more than 90% of electricity consumed domestically; while Sweden’s economically viable potential for bioenergy is much larger than Norway’s. Second, both countries experience a lock-in in dominant technologies; Norway suffers from “the resource curse” to some extent. Vast resources are being in a lock-in in the petroleum sector, which also has drained human intellectual capital. In contrast, Sweden struggles with a lock-in in nuclear energy. Third, the political factors have led to widely different outcomes in the two countries. In Sweden there has the last three decades generally been a stronger political will to implement efficient policies on renewable energy. This is caused by several factors, including major parties stronger prioritizing renewables expansion. Norwegian parties, in contrast, have generally promoted status quo preserving policies regarding renewables. Further, as a grand scale petroleum exporter, Norway has no concerns about enhancing energy security, while this is important in Sweden. Fourth, the mix of policy measures chosen to attain the various targets has been different. Sweden has generally implemented far more and more stable support policies, making investment in renewable energy generally safe and attractive.
