Archive: Åsa Romson, Minister for Climate and the Environment, Deputy Prime Minister

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Fossil-free transport and travel: The Government’s work to reduce the impact of transport on the climate

Sweden will be one of the world’s first fossil-free welfare countries. To achieve this, all actors in society must work actively to reduce emissions. By taking responsibility for our climate impact at home, we are demonstrating leadership on the world stage. The transition to a green society creates new jobs. This is why the Government is investing in renewable energy, fossil-free travel and investment support for reduced emissions.

To break fossil-fuel dependence and reduce emissions, a transition of the transport sector is both necessary and possible. This requires a society where we use transport in a smarter way. Adequate change can only be accomplished through a society that is more transport-restrictive in combination with more resource-efficient vehicles and a transition to renewable types of energy and electrification.

How can we achieve fossil-free transport and travel?

  1. To achieve a fossil-free vehicle fleet, several actions must be taken.
  2. Society must make smarter use of transport, including transferring goods transport from roads to railways and shipping.Fossil fuels must be replaced by sustainable fuels, such as biofuels.
  3. There must be more electrification in the transport sector.

More renewable energy sources provide conditions for fossil-free transport and travel

A crucial factor for achieving a fossil-free transport sector is access to renewable energy. By increasing the proportion of vehicles fuelled by electricity and increasing electricity production from renewable energy sources, more vehicles can be fuelled by electricity at the same time as carbon dioxide emissions are reduced. Biogas is also released and can be used by other types of vehicles that are more difficult to fuel by electricity. The Government's vision is that Sweden will have an energy system entirely based on renewable energy sources.

What is the Government doing to achieve fossil-free transport and travel?

In its Budget Bill for 2016, the Government is committing to several investments in the transport sector and has several inquiries under way to lay the foundation for further measures. The final report from the Inquiry 'Freedom from fossil fuels on the road' (Fossilfritt på väg, SOU 2013:84) constitutes important background material for the Government in this work. The Government has moved forward with several proposals submitted by the Inquiry.

Below are examples of initiatives and measures to break fossil-fuel dependence that the Government has implemented or is working to implement.

The Climate leap – support for local climate investments

A state programme for local climate investments totalling SEK 1 925 million (for the period 2015–2018) was introduced in 2015. Climate investments enable support for investments that can reduce emissions and influence the transition to fossil-free transport and travel. Support has gone to climate investments in areas such as charging infrastructure, production of biogas and biofuel filling stations.

Urban environment agreements that co-finance local and regional public transport projects
It is important that the increase of passenger transport in urban areas occurs in public transport, bicycle and pedestrian traffic, so motor traffic can decrease. The Government's urban environment agreements can be seen as part of this work. To stimulate municipalities' work on sustainable cities and public transport, the Government has earmarked SEK 500 million per year for the period 2015–2018 for state co-financing of local and regional investments in public transport in urban areas, through a framework for urban environment agreements.

Carbon dioxide tax that continues the move towards renewable energy

To achieve the Government's ambitions and climate objectives, a carbon dioxide tax is needed with a strong environmental management effect that provides prospects for a continued increase of the use of renewable alternatives and investments in new green jobs. The Government has raised taxes on petrol and diesel, and has indexed these to increase investments in renewable fuels.

The Government is working to ensure that the Swedish carbon dioxide tax will be approved by the EU. In the meantime, Sweden has an exemption from the EU's energy tax and state aid rules. Without the exemption, Sweden would have had to introduce full taxation on biofuels. The exemption applies until the end of 2018 for liquid fuels and until the end of 2020 for gas.

Increased low-level blends

From 2016, the Government has abolished the tax ceiling for low-level blended biofuels, which means that low-level blends of ethanol in the petrol are possible up to and including 10 per cent by volume and fatty acid methyl esters (FAME) in diesel are possible up to and including 7 per cent by volume.

Higher energy tax on fuel

The Inquiry 'Freedom from fossil fuels on the road' proposed raising diesel tax in three stages by 2020. In the Budget Bill for 2016, the Government raised energy tax on fuel. The tax was raised by SEK 0.48 per litre for petrol and by SEK 0.53 per litre for diesel fuel as from 1 January 2016. In addition, the tax will be raised in the future using the consumer price index plus 2 per cent per year to better reflect GDP growth.

Changed deduction regulations for hydrogenated vegetable oils

The Government introduced a tax exemption above the previous limit of 15 per cent for hydrogenated vegetable oils (HVO). This was implemented by the Government in the Budget Bill for 2015 and applied retroactively from 1 May 2014.

Vehicle premium for vehicles with very low emissions

The Government is raising the appropriation for the super green car rebate by SEK 132 million for 2015 and by SEK 94 million for 2016. From 2016, cars with zero emissions receive a full premium while other super green cars receive a half premium. In 2016, the Government will introduce an electric bus premium to promote the introduction of electricity-powered buses in the market. SEK 50 million will be allocated in 2016 and SEK 100 million per year will be allocated during 2017–2019.

Reduced taxable benefit for certain green cars

In its Budget Bill for 2016, the Government stated that the reduced taxable benefit for gas-powered cars, plug-in hybrids and electric cars will be extended until the end of 2019. The reduction amounts to 40 per cent of the taxable benefit, although a ceiling of no more than SEK 10 000 was introduced for more expensive cars.

Bonus-malus system for light cars

The Inquiry 'Freedom from fossil fuels on the road' submitted two alternative proposals – without advocating one over the other – regarding the introduction of a bonus-malus system. Both proposals entail changes to vehicle and car benefit taxation and the premium system for purchases of new cars. The Government has appointed an inquiry that is to present its report by 29 April 2016. The aim is that the system will enter into force on 1 January 2017.

Increased appropriation for railway maintenance

Rail traffic is essential for jobs, competitiveness and climate adaptation. An efficient railway helps the desired transition of transport from roads to railways, resulting in reduced climate emissions. For this reason, the Government is increasing the appropriation for railway maintenance by SEK 1.24 billion per year for the period 2016–2018.

Focus on travel-free meetings at government agencies

The Inquiry 'Freedom from fossil fuels on the road' recommended that the Government increase knowledge about travel-free meetings and invest in good and accessible technology in the business world and public organisations. The Swedish Transport Administration was previously tasked by the Government to run the project 'Travel-free meetings at government agencies'. The project brings together around twenty government agencies with the objective of increasing conditions for travel-free meetings. Government agencies that actively took part in the project have reduced their CO2 emissions by approximately 10 per cent in the period 2011–2014. In the same period, other government agencies contributed to an increase of emissions by nearly the equivalent amount. Now 62 government agencies have been instructed by the Government to strengthen work on travel-free meetings and thereby work actively to reduce carbon dioxide emissions in their travel and transport.

Energy labelling of vehicles

The Inquiry 'Freedom from fossil fuels on the road' proposed an energy labelling system for light vehicles similar to labelling of items such as refrigerators (A, B, C etc.) and further proposes that the Swedish Consumer Agency be given regulatory responsibility in this area. The Government has instructed the Inquiry on the bonus-malus system to study the matter. See the paragraph on the bonus-malus system above.

Road wear tax on heavy goods vehicles

The Inquiry 'Freedom from fossil fuels on the road' proposed the introduction of a 'kilometre tax'. The Government has appointed an inquiry on the introduction of a road wear tax (ToR 2015:47) which is to present its report by 9 December 2016.

Heavier and longer goods vehicles

The Inquiry 'Freedom from fossil fuels on the road' proposed changes to permit longer and heavier goods vehicles to use suitable sections of the road network. The Government has tasked the Swedish Transport Administration with examining the possibility of using heavier goods vehicles, and its report was submitted in November 2015.

The Swedish Energy Agency coordinates energy transition in the transport sector

The Inquiry 'Freedom from fossil fuels on the road' proposed the appointment of a coordinator for reduced climate impact by transport, electrification of roads, charging infrastructure and biofuels. The Government is providing SEK 3 million in the period 2016–2019 to the Swedish Energy Agency for coordination of energy transition in the transport sector, development of charging infrastructure and information about charging unit placement.

Tax on air travel

With tax on air travel, aviation can bear its own climate costs to a greater extent. The Government has therefore appointed an inquiry to analyse and submit proposals for how tax on air travel can be designed.

Task to develop environmental zone regulations

The Government tasked the Swedish Transport Agency with proposing how to develop current environmental zone regulations to better contribute to achieving environmental quality objectives and transport policy objectives. The assignment includes submitting proposals on:

  • how cars, light goods vehicles and light buses can be included in the environmental zone regulations;
  • how environmental zone regulations can be used to reward quiet and emissions-free – both light and heavy – vehicles; and
  • how compliance can be ensured.

The report is to be submitted to the Government Offices by 30 September 2016.

Collaboration

For Sweden to be free from fossil fuels requires that all actors in society collaborate and work actively to reduce emissions. This is why the Government has launched the Fossil Free Sweden initiative, where various actors are given the chance to highlight how, through their activities, they help solve climate problems and achieve the goal of a fossil-free society.

Fossil Free Sweden

The Government has also appointed the analysis group 'The green transition' (Grön omställning), with a key starting point that high ambitions in the area of climate policy can go hand in hand with the development of a dynamic business sector. Based on a long-term perspective, the group will analyse the most central building blocks of a green transition, such as policy levers and long-term rules for sustainable production and consumption, green investments, and regional and local change processes for sustainability that help all of Sweden thrive and develop.

The Green Transition