Sweden’s Minister of the Environment, Andreas Carlgren announced that the purchase of an environmentally friendly car will entitle the buyer to a SEK 10,000 ($US1,400) cash payment.

“We estimate that sales of green cars will increase at a rate of 10 to 15 percent per year,” said Carlgren. The government has set aside SEK 250 million (US$36 million) for the program, which is scheduled to run from 1 April 2007 to the end of 2009.

The Swedish government’s definition of a green car is tied to fuel consumption as well as technologies such as hybrid or ethanol-fueled powertrains. A conventional petrol-driven car, for example, can also qualify for a cash bonus if it has a fuel consumption of less than half a liter per ten kilometers (47 mpg US). Carlgren noted that “more or less all car makers, including Volvo and Saab, have at least one model that meets the criteria for classification as a green car.”

The bonuses will be paid out by Vägverket, the Swedish National Roads Administration.