Obama: Learn from Sweden, home of the carbon tax

The world’s most “sustainable country” has found a new admirer in President Obama, who continues to flirt with a carbon tax.

“Sweden is obviously an extraordinary leader when it comes to tackling climate change and increasing energy efficiency, and developing new technologies. And the goal of achieving a carbon-neutral economy is remarkable, and Sweden is well on its way. We deeply respect and admire that and think we can learn from it,” Obama said in Stockholm.

The president is touting his new plan to tackle global warming, which largely relies on the use of executive orders to impose new emissions standards on U.S. coal plants while promoting renewable energy development on federal lands.

According to reports, Sweden is on a quest to become the world’s first country to stop using oil, which made up about 28 percent of its energy portfolio in 2010. Furthermore, the switch from oil to alternative fuels is spurred by fears among the Royal Swedish Academy of Sciences that the world is nearing peak oil and prices will soon skyrocket.

The International Energy Agency says that Sweden gets most of its “renewable” energy hydroelectric and nuclear power. Nukes generate 30 percent of the country while renewable sources, mainly biomass and hydro, made up 35 percent of the country’s power in 2010.

“Our dependency on oil should be broken by 2020,” said Mona Sahlin, former minister of Sustainable Development. “There shall always be better alternatives to oil, which means no house should need oil for heating, and no driver should need to turn solely to gasoline.”

One of the biggest drivers behind Sweden’s switch to renewable energy away from fossil fuels is the steep carbon tax the country imposed in 1991.

According to “The carbon tax system has changed a bit over the years, increasing from $133 per tonne to $150 per tonne, and forcing consumers to pay more, and industry less, but it has been essential to help persuade people to pursue clean energy sources, and raise money that the government could invest in developing renewable energy generating capacity.”

Taxes make the cost of using oil and natural gas extremely high, according to European Union data. In 2011, for example, Swedish households faced the highest prices for natural gas which was 4.2 times more expensive than the cheapest gas prices in Europe — in Romania. Furthermore, nearly half the cost of natural gas in Sweden — 44.3 percent — was due to taxes and levies in 2011.

Obama’s praise of Sweden comes at an odd time, since just last week, the administration hailed booming U.S. oil production for lowering the trade deficit and increasing economic growth last quarter.

“This is yet another reminder that the President’s focus on increasing America’s energy independence is not just a critical national security strategy, it is also part of an economic plan to create jobs, expand growth and cut the trade deficit,” reads the White House blog.

The controversial practice hydraulic fracturing has allowed oil and gas companies to reach vast amounts of oil and gas that were previously uneconomical to extract, and the U.S. is ranked twelfth in the world in terms of its proven oil reserves. According to the Energy information Administration, the U.S. has 29 billion of proven oil reserves in 2011, a 15 percent increase from 2010 estimates.

Furthermore, the increase in the U.S. oil supply has helped fuel an economic recovery in hard-hit parts of the country. According to a study from IHS, the oil and natural gas boom supports 1.2 million jobs which could grow to 3.3 million by 2020. Energy development has also added more than $1,200 to discretionary income of the average U.S. household.

Obama’s remarks also come as some Democrats have expressed interest in making a carbon tax part of comprehensive tax reform which is being debated on Capitol Hill.

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