Sweden’s minority coalition has agreed to lower the amount of biofuel mixed in diesel and gasoline, a move it says will cut prices for cash-strapped drivers, but which climate groups say will increase C02 emissions.
The coalition, which is backed by the right-wing anti-immigration Sweden Democrats, has already cut taxes on fuel, increased tax breaks for people who drive to work, and ended subsidies for new electric vehicles.
Like other Europeans, Swedes face a cost-of-living crisis amid soaring inflation but also have some of the highest diesel and petrol prices in the world, mainly due to heavy taxes.
Diesel currently costs around 20.3 Swedish crowns (USD 2.00) per liter and petrol 18.8 crowns. The government said reducing the amount of biofuel will cut the cost of a liter of diesel by 5.5 Swedish crowns.
Mixing in biofuels from renewable sources was meant to encourage a shift toward electric vehicles but the government says it penalizes people who live in the countryside.
“The rules for the biofuel mix have not been an effective climate policy,” the government and the Sweden Democrats said in the Dagens Nyheter newspaper on Sunday.
The government said at the weekend it will cut the amount of biofuel to 6% at the start of 2024. Under current rules diesel has to contain 30.5% bio-fuel and petrol 7.8%. The percentage was meant to increase each year.
The Environmental Protection Agency said last month that Sweden risked missing 2030 targets meant as milestones toward the goal of net zero emissions by 2045, if it cut biofuel additives.
The Sweden Democrats had wanted the level of biofuels to be cut to zero and had threatened to bring down the government if that did not happen.