Stockholm is tapping revenues from its congestion pricing scheme to raise funds for new metro lines that will service affordable housing developments.

The Challenge

The population of Greater Stockholm is increasing by around 35,000 people per year. To accommodate this growth, the city plans to build around 10,000 apartments per year while increasing density and mix of uses. As the transport sector is responsible for around one-third of the city’s greenhouse gas emissions, Stockholm realized there was a need for integrated solutions to urban development in which new housing and public transit are intrinsically connected.


The Solution

Stockholm’s population is growing rapidly, causing an acute need for affordable housing and improved urban mobility. To tackle these challenges and lower CO2 emissions from the transportation sector, the Swedish capital has developed an integrated solution with an innovative financing model that taps into the revenues from the congestion pricing scheme. These revenues will be used to fund the construction of new metro lines to serve the residents of 78,000 apartments under construction in high-density, mixed use areas close to the urban core.

Stockholm’s existing congestion pricing scheme was expanded in terms of price and geographic area to increase revenues in order to help fund the metro construction. The expanded congestion pricing scheme takes effect in 2016 and will reduce traffic levels as well as greenhouse gas emissions from road transport in Stockholm County. The expanded congestion pricing scheme will also reduce daily vehicle kilometers traveled by around 270,000.


Economic Benefits – Traffic levels are projected to fall by around 7% to and from the city, and by around 10% on the motorway bypass, due to the congestion pricing scheme. The resulting travel time reductions are equivalent to $80 million per day.

Health Benefits – Congestion pricing has led to 15% reductions in PM10 and NOx emissions in the inner city as well as reduced noise levels.


About Cities100

Presented by C40 Cities Climate Leadership Group (C40), Sustainia and Realdania – Cities100 showcases leading solutions to urban climate challenges in ten sectors, ranging from solid waste management to transportation.

Available online and in print, Cities100 provides stakeholders an accessible format to explore achievable solutions for climate action in cities, and will be a useful tool for relevant groups ranging from impact investors and development organizations, to mayors and city governments.  You can access the full Cities100 2015 publication online here.