Sweden Walks Back on Climate. What Does it Mean for the EU, Tech and You?
Sweden decided it wasn't using it anyway... 🤷♂️
I unpack how climate change makes our world weird one take at a time, so you don’t have to!
Honestly, I was surprised.
I thought Europe was going HAM for pro-climate policies, as evident by the European Commission’s move to set aggressive 2040 emissions targets. That’s why I was surprised to learn that Sweden, a country in Europe last I checked, is slowly but surely walking back on its climate commitments. Silly me.
Sweden isn’t the problem here, if we’re being honest, and it’s not the only country to quietly walk back climate leadership and is yet another signal that a worrying gulf is widening between the European Union and its member countries.
So, today, we’ll cover:
What’s up with Sweden’s climate leadership?
Who else is quietly walking back on their promises? 👣
What does it Mean for Europe and the World? 🌍
What does it say about the Reconfiguration? 🔄
Who bloody cares? 🤷
1. A Big Effing Brick in the Wall
Sweden was once considered the darling of Europe when it came to climate leadership.
Over the years, Sweden has made many headlines, showing its commitment to climate leadership while maintaining economic growth.
In particular, Sweden…
Peaked fossil fuels by 1979 and since then halved its emissions, while GDP doubled
Made significant investments in climate funding
Was the first to tax carbon emissions, since 1991
Sweden is also the home of:
Svante Arrhenius, the first physicist to document the role of carbon emissions
The Stockholm Conference, aka the United Nations Conference on the Human Environment
Greta Thunberg… (who is busy doing other things these days)
It’s hard to overestimate Sweden and the Swedes’ role in propelling climate action and progress. But ever since the new conservative movement rose to power in 2022, something fundamental changed.
Essentially, Sweden has stopped investing in climate action, focusing its attention towards defense, immigration and “cheap fuel and public safety”.
Since 2022, Sweden changed course dramatically, walking back many of its pre-existing policies:
Cut or reversed green investments: halted high-speed rail, cancelled EV subsidies, cut green fund investments, and abandoned offshore wind support.
Made renewables less attractive: increased taxes on solar, reduced biofuel blending, removed airline ticket taxes.
Favored fossil fuels and old infrastructure: increased fossil fuel/aviation subsidies, slashed gasoline prices, made municipal funding for clean energy unpredictable.
According to the OECD, Sweden is currently on track to miss all but 1 of its 16 climate goals for 2030.
Wow. That’s… that’s hard to digest.
To be fair to the Swedes, they want Sweden to lead on climate. But, government policy today is not reflective of this support. It’s also worth asking if Swedish support acknowledges the price the country will pay in coming years, as the transition takes hold (if it takes hold at all).
Still, Sweden’s retreat is not unique.
2. Who Else is Walking Back on Their Promises?
Sweden is not the only country to miss its climate goals and quietly walk back its climate goals:
Poland flat-out rejected the 2040 emissions targets
Germany watered down its Climate Protection Act
UK is rolling back some of its climate promises
Netherlands is finding it hard to implement existing policies, risking missing its 2030 targets
It seems that the specters of war and growing defense budgets, political realignment and competitiveness concerns are all contributing to this widening gulf.
These walk backs catch the EU at a difficult time: European leaders are trying to navigate the turbulent geopolitical waters and balance the continent’s dependence on the US for trade, China for green tech and Russia for energy, and it’s not looking too great.
3. A Widening Gap
Told You So.
Hate to say I told you, but… I kind-of did. Actually that’s a lie. I don’t hate it at all.
To be fair, I thought the climate backlash has yet to come, and maybe in some ways it is still a few years away from reaching in full force. But it’s hard to argue that there’s a growing rift between the European Union and its institutions and its members.
European parliament elections often raise the issue of disconnect between the EU and its citizen base. There are also countries that often rub the union the wrong way, like Hungary (hey Viktor Orbán👋).
But this is different.
It seems like countries that traditionally have been the backbone of EU policy are walking back on climate leadership, while the EU itself is signing agreements with China to continue to be leaders (a bit ridiculous if you ask me 🤦♂️).
Europeans faces a tangle of urgent challenges, all pulling in different directions. They need to maintain business attractiveness; they need to reduce their dependence on literally everyone; they need to raise their defense spending and have genuine security concerns; they have to compete in the global AI race; and finally, they have this nagging climate challenge.
The problem with Europe’s dilemma is that a deteriorating climate will ultimately make its choices even harder, with climate change being a “threat multiplier”. Oh well 🤷♂️🤦♂️
It’s about money. And brand. But mostly about money.
At the end of the day, climate leadership has become as much about brand value and economic returns as environmental virtue.
Up until today, Europe enjoyed a strong brand as a climate protector, especially as the Trump Administration is being… well, the Trump Administration. This is not only a boy scout merit badge. This brand makes Europe an attractive destination for climate investments, which can be very lucrative. There’s also the small added benefit of actually having a better climate.
But recently, this brand is undermined by member states’ actions, and this is bad news for Europe’s attractiveness, investors, startups and the planet. Europe’s mixed climate signals may end up costing a fortune. 💸
Who wins?
One central question looms: what will happen next with this widening gap?
Who will win in this tug-of-war? Will Europe fulfill its self-appointed role as herald of climate leadership? Or, will its member states undermine the union’s ambition and dissolve it from within?
4. Re-Reconfiguration?
The Reconfiguration is not linear or simple. We cannot assume that just because climate change is happening, everything will reconfigure towards climate leadership. On the contrary, often have unexpected, even contradictory, effects, leading to backlash at both federal and local levels, as seen in the US today.
What is happening in Europe only shows the complex nature of the Reconfiguration, and how nuanced transitions and transformations are. I expect to see more nuanced and contradictory dynamics ahead.
And this leads us to… who cares?🤷♂️
5. Ok… Who should care?
Well…
🌍 Brussels, for starters. European leaders should pay more attention to how member states are reacting, and how the “field” is responding to climate leadership efforts. They should ask themselves if the citizenry views their actions as fair and equitable and listen to the street. They should also pay attention to the widening gulf between the institutions of the union and the countries that give it power.
💡Investors and Startups should also pay close attention. The brand may be European, but climate projects are local and subject to the policies of the countries they operate in. It’s little consolation that Europe is pro-climate, if the country you’re building your First-of-a-Kind factory in has canceled your subsidies. If you plan on operating in Europe, you should develop nuanced strategies for the European market, because it’s not one market. It’s 27 of them.
⚠️ You should pay attention. These policies will ultimately impact every one of us, whether we live in Europe or not. If you live in Europe, you can actually make a difference and contribute to the conversation.
That’s it for this week.
As always, stay tuned to Saturday’s edition of “The Time Machine”, where I tell you what things you should care about this week. As a reminder, I’m still tweaking this newsletter, so if you have suggestions - hit me up!
See you on Saturday, and next week with a brand new take!
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