Swedish Waste Incineration Tax Abolished

Recent changes in the European electricity market have made the Swedish Parliament abolish the waste incineration tax introduced two and a half years ago

2023 has brought changes to the Swedish waste incineration tax. The Swedish Parliament decided to abolish from the 1st of January the waste incineration tax for production of electricity and district heating that came into effect in April 2020 and that was strongly criticised by the energy plants in the country. The Swedish Parliament expected that this tax would have an effect on increasing recycling rates and promote a more efficient resource handling. However, two and a half years later, the Swedish Government claims that the Russia’s invasion of Ukraine and its effect in the energy market have changed the conditions for the European electricity market, and therefore, this decision needed to be reconsidered. 

This was the second attempt by the Swedish Government to implement a waste incineration tax. The first was between 2006-2010 with no positive effect on the recycling rates. Despite several reports from experts in the field stated that the implementation of the waste incineration tax would not have an environmental effect, the Swedish Government decided to give it another try and in 2020 announced the introduction of a new tax on waste incineration. This time, the tax came into effect on the 1st of April 2020 as part of a plan of the Swedish Government to achieve national climate and environmental goals and contribute to a more resource efficient waste handling. The tax was set to SEK 75 per ton in 2020 and increased gradually to SEK 172 per tonne by 2022 (exemptions: hazardous waste, biofuels or animal-by-products). This decision was relatively controversial since the main actors, energy plants, claimed that would not help to improve resource handling.  

In the meantime, neighbouring Norway introduced a waste incineration tax in 2022, also, in spite of unconclusive results in Sweden, with the aim of increasing material recovery.  

The tax will be further increased in 2023 (https://www.skatteetaten.no/bedrift-og-organisasjon/avgifter/saravgifter/om/avfallsforbrenning/). Norway, with a waste-to-energy (WtE)* capacity of about 2 Mton, exports more than 1 M ton waste to Sweden, most of it being sent to WtE. It remains to see if increased costs in Norway will lead to increased export to Sweden, possibly threatening the operation of some actors in the Norwegian WtE sector while having an uncertain impact on material recovery. 

* Norwegian WtE delivers about 50% of district heating. 

For details, see also https://task36.ieabioenergy.com/news/msw-incineration-fee-in-norway/ 

Link to the decision (only available in Swedish) here. 

More details about the Swedish and Norwegian incineration tax