Forest-owner Lars-Erik Levin doesn’t seem like an environmental villain. As he walks through his 80 hectares (198 acres) of woodland in southern Sweden, he identifies goldcrests by their song, points out a cauliflower fungus and shows off the aspen in his wood that grouse feed on. This year he’s picked more than 100kg of chanterelles, and even more bilberries.

But this is the part of the property he manages by so-called continuous cover forestry, where he claims he only fells trees with trunks so thick his arms no longer reach around them. On the other side of his farmhouse is a wide-open space the size of two football pitches, where, five years ago, he cut the forest to the stumps. Little now remains but grass, brambles and young, waist-high spruce. “Animals and birds have legs and wings, they can move a little,” he protests when asked what happened to the wildlife.

“It’s devastation,” says Magnus Bondesson, the local officer for the Swedish Forest Agency. “It’s not a good thing for biodiversity.”

Clear-cutting, which sees a total forest area a third larger than Greater London cut to the stumps every single year in Sweden, has become a hot political issue after the EU’s new forest strategy in July said the technique should be “approached with caution”, and called for Sweden to protect more of its forests.

Forestry policy now threatens to cause clashes with the European commission. The Swedish prime minister, Stefan Lofven, declared in a speech to open parliament that “forestry should not be micro-regulated from Brussels”.

The issue also threatens the stability of the government. The Social Democrats’ coalition partner, the Green party, last week refused to bow to a demand from the agrarian Centre party that forest owners’ property rights should be strengthened, as part of its price for propping up the government.

The issue is even splitting the Green party itself, pitting those who see forest products as key to the green transition against those who want to protect biodiversity at all costs.

“I describe it as environmental destruction, the most serious damage ongoing in Sweden,” says Rebecka Le Moine, the radical runner-up in last year’s party leadership contest.

Unlike many other European countries, Sweden doesn’t have a limit on clear-cutting, meaning that areas of more than 100 hectares can be cut in one go, threatening the 2,000 red-listed species connected to the country’s forests.

Le Moine is pushing for her party at its October annual meeting to agree to campaign to limit clear-cuts to two hectares and to push for wood used for heating to no longer be seen as renewable and instead taxed on its emissions, like coal or oil.

Maria Gardfjell, the party’s spokesperson for forestry, who is herself a forest owner, admits the party is split.

“If you look at Green party policy, it’s not the same as what you hear from Rebecka. It’s not our politics,” she says. “If you take the climate law we have in Sweden, you can see that we will need forest products as substitutes for plastic, clothes, fuel and almost every kind of product. But at the same time, we need to promote biodiversity much, much more.”

At Levin’s property, he walks from his lush, natural-seeming continuous cover forest into an area he planted with spruce 30 years ago. It comes as a jolt. Whereas in the continuous cover area there are trees of all ages, and in places thick undergrowth, the spruce forest is a plantation, the trees evenly spaced and all the same age.

“It’s a bit darker,” says Bondesson, while admitting the biodiversity is “zero”. “It wouldn’t feed a mouse. There are mushrooms, but that’s it.”

It is by no means clear, however, which of the two areas brings the most environmental benefits. “The spruce produces 15 to 20 cubic metres of wood per hectare, and the continuous cover produces five,” Bondesson explains. “Do you understand the climate impact? How much more carbon dioxide it is binding?”

According to Tomas Lundmark, a professor of forestry ecology management at the Swedish University of Agricultural Sciences, harvesting forests by clear-cutting and then growing trees of the same age absorbs on average as much as 30% more carbon than if you use continuous cover forestry techniques, perhaps even more.

Trees of 30 to 50 years old, like those in Levin’s plantation, absorb the most carbon, while forests untouched for hundreds of years tend to be small net emitters. This is the industry’s big claim to sustainability.

The total volume of standing wood stored in Sweden’s forests has more than doubled over the past century, and its forests are still sucking in a net 48 million tonnes of CO₂ a year as they grow, with another 7 million stored in long-lasting products made from Swedish wood. Taken together, that’s enough to make Sweden effectively carbon neutral.

The supply of biofuels in Sweden has tripled over the past 40 years and now provides close to 30% of its total energy supply, helping to halve its consumption of petroleum products.

For Le Moine, however, none of this is worth the loss of natural habitat. “They keep telling us we have more forests now than we had before,” she says. “My reply is we have never had this many trees, but never had such a little amount of forest ecosystem.”

Levin says that when he started doing continuous cover forestry back in the 1980s, he had to keep it secret as it was viewed by the forest agency as “almost criminal”. Now, others are starting to see the advantages. “It’s beautiful,” he says. “It produces money, and berries and mushrooms, and it’s not so much work.”

But he grimaces at the mention of activists such as Skydda Skogen (Save the Forests) or Le Moine, who want clear-cutting stopped altogether.

“They don’t understand that the forests have to do their work,” he says. “They need to make money for people, so that people can live out here.”