Should Sweden be a pioneering country? The experts have different opinions on the matter

The government's expert John Hassler thinks that Sweden's 2030 goals are obsolete, pointless and expensive. Mattias Goldmann at the 2030 secretariat thinks the opposite: Those who lead the way inspire others and can also make a good deal out of it. Which path should Sweden choose?

Next week, national economist John Hassler will report to the government how Swedish climate policy can be developed against the background of the EU's new climate legislation Fit for 55. The fact that he was given the task to quickly investigate the issue in June was perceived by many as both controversial and logical. Hassler has long been critical of the reduction obligation and also thinks that the Swedish transport policy goal of reducing emissions from domestic transport by 70 percent by 2030 compared to 2010 is obsolete. Now there are rumors that his investigation wants to scrap the case.

“Previously, when quite a bit happened at EU level, it was important that Sweden set national goals. But it doesn't look like that anymore. Admittedly, far too little is happening globally, but at the EU level there are now not only ambitious goals, but also the policy instruments needed to reach them have been decided”, says John Hassler.

He calls it an extreme game changer. Because if the EU fulfills the Paris Agreement's requirements, so does Sweden. Thus, a Swedish climate target for domestic transport with a focus on national carbon dioxide footprints can be thrown in the trash.

“A control system that operates at EU level is much more effective. It guarantees results, there will be no unnecessary costs and it guarantees competitive neutrality. The EU also controls trade policy and can put pressure on other countries and ensure that domestic industries are not outcompeted by others. The controls in Fit for 55 will work. We can be sure of that.”

The Swedish transport policy goal is not only pointless, it can also have direct negative consequences, says John Hassler.

“It creates a situation where Sweden vacuums up the world market for biofuel. That hardly makes us an example. The rest of the world rather gets pissed off at us who live in one of the world's most forested countries and still have to vacuum the world market to get biofuel for our cars. In addition, it is extremely doubtful whether this is good for the climate. Many researchers believe that it is not. Biofuels that are burned in cars lead to emissions of carbon dioxide just like when an engine runs on gasoline or diesel.”

In order for the fuel to be climate-neutral, it is required that the value chain in other stages consumes a corresponding amount of CO2, for example by forest that is used as raw material absorbing carbon dioxide.

“If we hadn't had the Swedish transport policy goal, I don't think we would ever have come up with the idea of introducing a reduction obligation. However, there is nothing wrong with biofuel in itself. But what is needed is sustainable and efficient production, and Sweden has good conditions for that. Biofuels will be needed in shipping and aviation. When it comes to cars, most things point towards electrification.”

So what should Sweden's climate policy focus on?

“We must devote ourselves to what we in Sweden used to call structural transformation politics, politics that facilitates everything that is required for a changeover. It is about everything from competence development and electricity supply to efficient permit processes and ports functioning. We need to think centrally about what is required for us to remain competitive given the new rules that have now been decided at EU level. It is important for Sweden's economy and it is important for the climate. It is the question of profitability that becomes important, not counting on carbon dioxide emissions. It's way too tight.”

Sweden must also look outwards. It is internationally, outside the EU, that the large emissions are found.

“That is the big challenge and of course easier said than done. It is about putting pressure on other countries and using trade policy. If we don't get countries like India and China, what we are doing here is completely pointless from a climate point of view.”

But it is not impossible. According to John Hassler, his and other national economists' research has shown that a slow transition to complete climate neutrality in 2050 makes the most sense based on today's conditions.

“An orderly transition over 30 years does not have to be very expensive. It may not even need to go that fast, but it is a decent cheap insurance against very uncertain risks.”

However, we have no interest in progressing faster in Sweden, he says.

“If we in the EU progress twice as fast, then we might save a year for China or a few years for India. It will have a very small effect but very much more expensive.”

Mattias Goldmann, one of Sweden's most prominent environmental debaters and inspirers and co-founder of the 2030 Secretariat, thinks just the opposite. Now it is better than ever for Sweden to be one step ahead. There was a certain risk in the past that we were alone in a knitting track, but that is no longer the case.

“The EU has shown where things are going, which means that the so-called pioneer country methodology is much less risky and much less costly. If you stay a step ahead of the development, you can find very nice deals, which the Swedish business community also emphasizes. If we want to be a welfare country with decently high wages and good pensions, we shouldn't be mainstream.”

He continues:

“In addition, the Swedish climate targets minimize the risk that we need to buy expensive emission rights or pay fines.”

The latter actually worried John Hassler in September when the government put forward its proposal for reduced taxes on petrol and diesel – a proposal he was skeptical of because it means that Sweden will not even be able to reduce emissions at the EU's rate.

“If we do not achieve what the EU demands, we will end up in the EU court and will incur heavy fines”, he told Expressen on September 7.

The new EU directives are of course good, but at the same time Mattias Goldmann raises a warning finger for having too much faith in them.

“There are elections to the EU Parliament next year. Then, unfortunately, we will almost certainly get a less climate-driving legislative assembly than we have now, and eventually we will also get an EU Commission that is less driving than the current one. In addition, the EU has found it very difficult to take a hard line against countries that flagrantly violated the EU's guidelines, such as Hungary and Poland.”

According to Mattias Goldmann, EU legislation is also not comprehensive. For example, the 2030 secretariat emphasizes that we must work on "the car, the fuel and the behaviour".

“There are quite good and plenty of suggestions for the car and the fuel, but basically nothing on the behavioral side. That's where typical national politics need to come in. The EU does not get involved in the design of travel deductions, how public transport is designed, how much VAT is on car pools and so on.”

So what is the risk of downplaying the importance of the domestic climate goals?

“There will be less clarity for those who want to go to the bank and borrow 100,000 SKR for solar cells, 100 million SKR  for a biogas plant or ten billion for a battery factory. As soon as it becomes uncertain whether the goals will be reached or not, or whether the goals will be reached or not, the security of the business world is disturbed. We have had a seven-party agreement, but when several of the leading parties say "if we don't reach the goals, we won't reach the goals", the will to invest is reduced and, by extension, Sweden's opportunities to cash in on climate leadership.”

But it is of course not just about Sweden's economy.

“Precedent countries are needed. The fact that the EU has now decided to become climate neutral in 2050 is because someone has shown that it actually works. The EU has also thanked the countries that have shown the way.”

The reduction obligation then? Is there something to the criticism of Hassler and others?

“Their description is very far from reality. It is important to look beyond what the right-wing writers write. Both the National Audit Office's review and the annual fuel report from the Energy Agency show that the majority of biofuels used in Sweden are made from waste, i.e. slaughterhouse residues and other things that would otherwise have lain and rotted. The claim that we vacuum the market is also wrong. About a third of the world's HVO is used in Sweden and that is because we have created a market that will hopefully spread. Here again we have an excellent example of the precedent methodology.”

On one level, however, Mattias Goldman and John Hassler agree. The transition doesn't have to be as difficult as we think. Fossil-free Sweden's new message that it is more about a communication problem than a technology problem has been an eye-opener. A new narrative that takes us away from guilt and shame is needed.

“We in the environmental movement must take it to heart. We are the ones who have talked about sacrifices and guilt and shame. We are the ones who have given the impression that it will be difficult and more expensive than it actually is and that we have gotten nowhere. It's an easy pit to fall into when you understand how rushed it is. But I hope we sharpen up and find a story that is more about how we build on what has been very successful for a long time for Sweden”, says Mattias Goldmann.