Government to accelerate electrification and phase-out of fossil fuels

“Electrification is the future. These are two proposals aimed at furthering the transition by electrifying our transportation and thereby making society less sensitive to, for example, oil price surges,” says Acting Minister for Climate and the Environment Johan Britz.

New reimbursement to government agencies 

The Government plans to propose SEK 500 million in reimbursements to central government agencies in 2026 aimed at accelerating climate transition this year. From 2023 to 2024, emissions from vehicles, work equipment and vessels used in government agency activities increased by 26 per cent. To reverse this trend, central government agencies can increase their use of renewable fuels such as hydrotreated vegetable oil (HVO100) or switch to electric alternatives.

The reimbursements will be paid out to central government agencies that replace fossil fuels in 2026. This support will correspond to the additional costs incurred when fossil fuels are replaced with fossil-free, renewable or electric alternatives. This is expected to begin reducing emissions from government agencies in 2026.

This investment will be funded by decreasing the appropriations for the Climate Leap, the climate premiums and the Government’s operational support for bio-CCS (carbon capture and storage). The Government assesses that all the funding allocated to these appropriations would not be utilised and that helping government agencies to reduce their emissions contributes more effectively to the climate transition.

Expanded electric vehicle premium

On 18 March, a new electric car premium was introduced in Sweden, targeting low-income households in rural areas and other areas with limited access to public transport. Households that meet the requirements can receive up to SEK 46 800 over a three-year period to purchase or lease a new or used electric car. The electric car premium is part of Sweden’s Social Climate Plan, which receives 75 per cent of its funding from the European Commission’s Social Climate Fund.

The Swedish Environmental Protection Agency has already received several thousand applications. To make it possible for more households to access the premium, the Government intends to propose an additional SEK 100 million in funding for the premium in 2026. This additional funding will enable more decisions granting the premium this year. The proposal will lead to increased support for the electrification of the vehicle fleet and is expected to accelerate the pace of emissions reduction in the transport sector.

These proposals are based on an agreement between the Government and the Sweden Democrats.