A political fight has erupted in Sweden over whether forest owners should be paid to delay harvesting trees as part of the country’s contribution to the EU’s ambitious carbon removal targets.
The EU’s Land Use, Land Use Change and Forestry (LULUCF) regulation requires the bloc to remove 310 million metric tons of CO2 equivalent by 2030. With Sweden holding the EU’s largest forest area, the country is expected to play a central role in meeting that target.
In 2022, the government commissioned a parliamentary committee to explore how to incentivize carbon storage.
Its proposal: legally binding contracts offering landowners 400 SEK (~$42) per ton of CO2 if they delay felling their trees for 5 to 20 years beyond the minimum harvest age. The scheme could cost taxpayers 2.36 billion SEK (~$246.2 million) through 2030.
Industry Pushback and Political Divide
The plan has triggered fierce opposition. The Swedish Forest Industries Federation warns that 7,200 jobs are at risk, with smaller sawmills particularly vulnerable.
Critics argue that leaving trees standing reduces raw material supply for paper, packaging, and construction – sectors already under pressure from declining paper demand.
“Small-scale saw mills would also risk closing due to increased raw material costs,” said Viveka Beckeman, the federation’s director general. Echoing this, the Sweden Democrats’ environmental policy spokesperson Martin Kinnunen called it “a very bad idea,” urging the EU to reconsider its carbon removal goals altogether.
Relevant: Carbon Direct Calls For Scaling Forest Carbon Measurement With AI And Remote Sensing
Supporters, however, argue that paying landowners reflects the forest’s true value. “We all benefit from the recreation, biodiversity and climate mitigation that the forest provides,” said Green Party politician Rebecka Le Moine.
While political uncertainty lingers, private markets are moving ahead. Estonian startup Arbonics began brokering carbon credit deals in Sweden earlier this year and has engaged nearly 500 landowners.
The government’s September budget will signal whether Sweden formally pursues state-backed carbon payments or leaves the opportunity to private carbon markets.
