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Real emission reductions and more pressure on the EU due to new Swedish EU ETS policy
The Swedish government today unveiled a new program with the aim to buy and cancel allowances in the EU emissions trading system. The government will annually invest 300 million SEK in allowances. The program is set to run throughout the period 2018-2040. At the current price, emissions of approximately 7 million tons of carbon dioxide will be purchased and cancelled annually.
The new program will not be netted against Sweden's commitments under the EU effort sharing decision or against the national climate target. The cancellation indicates more ambitious Swedish climate actions.
- EU ETS is the EU's key climate policy instruments, but the system has not worked as intended because of the huge surplus of allowances. Sweden will continue to work hard to reform and strengthen the EU ETS in the ongoing negotiations within the EU. By launching this program, we show that Sweden wants to see a strong emissions trading system and we also contribute to the higher level of ambition of the EU's climate policy needed in order to meet the objectives of the Paris Agreement, says Isabella Lövin, Minister for International Development Cooperation and Climate.
A checkpoint will be set up in 2025 and evaluations of possible further
measures in the program in relation to the development of the EU's total
emissions will be conducted every five years. The Swedish government will invite more countries to participate in the program. Individuals and businesses are invited and encouraged to purchase and cancel allowances. Consequently, the government will propose that companies be given greater incentive to do so through tax deductions in its autumn budget.
- Through this action, we can annually cancel another several million tons of emissions, and the overall effect will be considerably less carbon dioxide into the atmosphere, says Isabella Lövin.