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Sweden now has more than 50% renewables in the energy system with bioenergy as the single largest energy source providing in total about one-third of final energy use. Through a combination of efficient policies, such as the carbon dioxide tax and applied research, the heating sector has been successfully decarbonized. In addition, power production from biomass makes an important contribution to renewable power in Sweden. The major remaining challenge to decarbonize the energy system is to replace fossil fuels in the transportation sector.