In a Nutshell
- Sweden aims to achieve net zero greenhouse gas emissions by 2045, with a minimum emissions reduction of 85% based on the 1990 emissions levels in the EU Emissions Trading Scheme (ETS) and Effort Sharing Regulation (ESR) sectors and the remaining 15% met through measures referred to as ‘supplementary’, including specific forms of carbon removal.
- Bioenergy with Carbon Capture and Storage (BECCS), known as Bio-CCS in Sweden, is one of several allowed supplementary measures, with the Swedish government allocating SEK 36 billion (EUR 3,3 billion) for Bio-CCS from 2026 to 2046.
- Sweden also supports carbon removal research and development primarily through the Industrial Leap initiative.
Role for carbon removal in national climate policy
Through its 2017 target, Sweden has committed to achieving net zero greenhouse gas emissions by 2045. The target requires a minimum emissions reduction of 85% compared to 1990 levels with the remaining 15% to be met through supplementary measures, including carbon dioxide removal (CDR). The 2017 target also includes the potential additional net uptake of greenhouse gases as a result of policy interventions in forest and land (LULUCF- Land Use, Land Use Change and Forestry) and verified emission reductions outside Sweden’s borders purchased through Article 6 of the Paris Agreement.
Relevant legal frameworks
Bioenergy with Carbon Capture and Storage (BECCS), known as Bio-CCS in Sweden, is a notable component of Sweden’s carbon removal strategy. A 2020 public inquiry proposed that BECCS should contribute up to 1.8 MtCO2/year by 2030 and, indicatively, 3-10 MtCO2/year by 2045. 10 Mt accounts for approximately 20% of Sweden’s current total greenhouse gas emissions in the sectors covered by the EU Emissions Trading Scheme and the Effort Sharing Regulation, and around 25% of total CO2 emissions. Biochar was also mentioned as a potentially interesting solution for CDR in Sweden by the public inquiry, but it was not deemed appropriate for additional state support beyond funding made available through the Climate Leap scheme (Klimatklivet), due to the need for more applied research on how biochar could be used to meet Swedish mitigation targets.
The Swedish government has attributed SEK 36 billion (EUR 3,3 billion) for bio-CCS from 2026 to 2046, to be distributed across those who can capture and store carbon dioxide of biogenic origin at the lowest cost, determined through reverse auctions. The Swedish Energy Agency will hold the auctions and provide economic support to actors who have submitted the winning bids to the reverse auction.
Sweden has uniquely favourable conditions for BECCS in existing facilities burning biomass, including combined heat and power plants, paper and pulp mills, and waste incineration plants. The total potential for removals through BECCS is estimated to be close to 50 MtCO2 per year, with 19.3 MtCO2/year at a cost ranging from EUR 45-125/tCO2. The cost includes transport to intermediate storage hubs but not final transport and storage which would add another EUR 25 to 40/tCO2.
The Swedish Energy Agency proposes that entities receiving state support for BECCS should be able to sell carbon removal credits on a voluntary market. State support could be reduced by the sales price, in line with current state aid rules. The agency seeks to create a market and gradually phase out state support. Tonnes removed on Swedish territory will be included in national mitigation targets, with private buyers informed that their purchase helps reach Sweden’s targets. However, the industry criticises this approach, advocating for a model like Denmark, where companies purchasing negative emissions that have received state aid can offset them against their own emissions.
The Ministry of Finance has proposed a tax reduction to the minimum level on electricity for negative emissions projects. These companies would be covered by the lower energy tax level of 0.6 öre (EUR 0,055 cents) per kilowatt hour for the electricity consumed in the installation.
Internationally, Sweden has ratified the amendment to the Article 6 of the London Protocol, thus enabling the country to forge bilateral agreements regarding CO2 storage under the seabed. Sweden also plans to make use of Article 6 of the Paris Agreement to potentially offset part of its residual emissions as part of its supplementary measures package. The Energy Agency’s Article 6 programme is currently financed by SEK 1.5 billion (EUR 126 million) until 2032, which could also target carbon removal projects.
Support for R&D and Innovation
State-funded support for carbon removal research and development primarily occurs through the Industrial Leap initiative (Industriklivet), which has been allocated an additional SEK 600 million (EUR 55 million) per year from 2023 to 2025 and a mandate frame of SEK 5.2 billion (EUR 545 million) for 2024 to 2030. This includes support for carbon removal. A specific call in 2020 allocated SEK 100 million (EUR 9 million) per year until 2022 and SEK 50 million (EUR 4,5 million) per year until 2027 for research and innovation in negative emissions. Around thirty CDR projects have received support so far, many of which are feasibility studies for BECCS, alongside R&D and feasibility studies for other CDR methods such as DACCS (Direct Air Carbon Capture and Storage) that have also been awarded grants.
On the horizon
The reverse auction for BECCS is expected to commence six months after the EU Commission announces its decision on allowing Sweden to give state aid to national companies for verified geologically stored biogenic CO2.
Several of Sweden’s actors with facilities suitable for BECCS have indicated their interest in the auctioning scheme. Stockholm Exergi, with an 800,000 tonnes CO2/year removal capacity, has come the furthest with a research-facility (CO2 capture only). They have also been awarded an EU Innovation Fund grant of EUR 180 million.
The Swedish Geological Survey has been tasked with identifying suitable sites for geological carbon dioxide storage for future storage in Sweden. Domestic capacity is unknown, but assessments show two areas of interest in the south-east Baltic Sea and next to south-west Skåne. Storage of CO2 from Swedish BECCS projects in the medium term are expected to be located in the CO₂ storage fields being developed outside Norway and Denmark. In 2022, Sweden and Norway announced their intentions to sign an agreement, enabling the transportation of CO2 from Sweden to Norway.
- Net zero target: 2045
- Net Negative Target:
- First interim target: 2030
- Type of interim target: Emissions reduction target
- GHGs covered: Carbon dioxide and other GHGs
- Separate target for emission reduction and removals: No
- Comprehensive CDR Target: no
- CDR Target for Conventional Removals: yes
- CDR Target for Novel Removals: yes
- Historical emissions: No
- Annual reporting mechanism: Annual reporting
- Plans for carbon removal (CDR): Yes (nature-based removals e.g. Forestation, soil carbon enhancement)
- Planning to use external carbon credits: Yes
- Conditions on use of carbon credits: s
Public consultations and upcoming policies
- The Ministry of Finance proposal to implement a tax reduction to the minimum level on electricity for negative emissions projects is open for consultation until October 2023.
- The Energy Agency is expected to launch the reverse auction for the Bio-CCS state support system in 2023.
- The proposed rules around how carbon removal will be accounted for in Sweden and how the state support will be affected by sale of carbon removal are still pending.
- The Swedish Environmental Protection Agency, Naturvårdsverket, proposes policies for the government to implement and reports on emissions.
- The Swedish Energy Agency, Energimyndigheten, is responsible for the state support system for BECCS through reverse auctions.
- Industrial Leap initiative, Industriklivet is led by the Swedish Energy agency, supporting industrial decarbonization projects, including carbon removal.
Think Tanks and NGOs
- Fossilfritt Sverige, an initiative started by the government, creating pathways for decarbonisation of different sectors
Dr. Kenneth Möllersten
Dr. Mathias Fridahl