Unapologetic insolence from an aging subversive

Unapologetic insolence from an aging subversive

Saturday, 11 June 2011

More Light than Heat (Contd)

OK – so that’s what Europe is up to. Let’s have a look at the rest of the world.

Remember – all I’m doing is attempting to gather and summarize information as to what the rest of the world is doing in relation to action on global warming. At this stage I’m making no judgements as to whether action is necessary or useful – just looking at what’s really happening.

Reports surfaced in May 2010 that China will impose a carbon tax on industry from 2012 to curb carbon dioxide emissions. The Chinese language Economic Information Daily quoted official sources in the Ministry of Finance as saying the tax would start at 20 Yuan (£1.95) per tonne of carbon dioxide, and rise to 50 Yuan a tonne by 2020.
The C40 group of cities, many of which are in China, have initiated a range of actions designed to reduce emissions. Changsha is scaling back the number of high-polluting factories, building two subway lines and a light rail line and promoting electric buses. Shenzhen is making sure that new buildings use energy-efficient electrical equipment and developing its electric car industry. The southern city is home to electric car maker BYD Autos, which counts U.S. billionaire Warren Buffett among its investors.
In southern Kunming cities are promoting the use of solar power.

Costa Rica 

This country imposed a 3.5 percent carbon tax on fossil fuels in 1997. Part of the capital created by the tax goes to a program called "Payment for Environmental Services". This provides incentives to individuals and corporations to practice sustainable development and forest conservation. This plan protects 11% of Costa Rica's national territory. Read p6 of this report for more detail.

The program now pays out roughly $15 million a year.

Canada is not taking national action at this time, but its provinces are.
 Quebec introduced a carbon tax starting October 1, 2007, with revenue collected used for energy-efficiency programs including public transit.

On February 19, 2008,  British Columbia announced its intention to implement a carbon tax of $10 per tonne of carbon dioxide equivalent (CO2e) emissions (2.41 cents per litre on gasoline) beginning July 1, 2008. This made BC the first North American jurisdiction to implement such a tax which will increase each year after until 2012, reaching a final price of $30 per tonne.

Alberta: In July 2007 a carbon tax forcing companies that emit more than 100,000 tonnes of greenhouse gas annually was imposed by the Alberta government. The companies could opt to either reduce their CO2 emissions per barrel by 12 percent, pay $15 per tonne into a technology fund, or buy an offset in Alberta to apply against their total emissions.

United States


The US is similar to Canada in that it’s not taking consolidated national action, but states are imposing taxes.

In Colorado, Boulder city implemented a tax on electricity consumption (utility bills) with deductions for using electricity from renewable sources in November 2006. It’s designed to reduce carbon emissions to those outlined in the Kyoto Protocol. This tax, called the Climate Action Plan (CAP) tax is expected to raise $1.6 million dollars in 2010 and will expire on March 31, 2013.
In California the Bay Area Air Quality Management District passed a carbon tax on businesses of 4.4 cents per ton of CO2 in May 2008. In addition, a cap-in-trade system was put in place under global warming law, AB32. However, a few months ago, San Francisco Superior Court Judge Ernest Goldsmith suspended it in a plaint brought by California environmentalists alleging that it failed to properly consider alternatives which the judge rules violated state environmental law. The California Air Resources Board must conduct further review before implementing the plan which had been adopted in December 2010.
In Maryland, in May 2010 Montgomery County passed the nation's first county-level carbon tax which calls for payments of $5 per ton of CO2 emitted from any stationary source emitting more than a million tons of carbon dioxide during a calendar year.

The USA provides lip service to its Copenhagen commitment.


A nationwide carbon tax of 50 rupees per metric tonne ($1.07/t) of coal both produced and imported into India was introduced on July 1, 2010. The government is mandating the retirement of inefficient coal-fired power plants and supporting the research and development of IGCC and supercritical technologies. Under the Electricity Act 2003 and the National Tariff Policy 2006, the central and the state electricity regulatory commissions must purchase a certain percentage of grid-based power from renewable sources.

South Korea

South Korea has substituted a carbon tax with the current transportation tax.
The revenues, calculated to amount to an annual $11 trillion won ($10.4 billion) will finance the “Low Carbon, Green Growth” initiative. The tax is imposed on emissions of greenhouse gases including carbon dioxide.

New Zealand


A New Zealand Emissions Cap in Trade system was passed into law in November 2009.


Brazil passed a climate change bill in late 2009 that is intended to reduce national greenhouse gas emission by 39 per cent by 2020.  This goal is estimated to save around 1.06 billion metric tons of carbon dioxide equivalent by 2020. No carbon tax is in place at this time, but there is speculation that it will be soon.

So, how do you summarise all of this. Let me try by making a few statements of fact.

Most European countries have a price on carbon.

The two largest emitters (USA and China) don’t nationally, although many provinces states, cities or municipalities in these countries, particularly where the largest population concentrations exist, do.

Many other countries have cap in trade systems, although it’s interesting to note that Californian environmentalists have issued a successful legal challenge to such a scheme on the grounds that it doesn’t reduce emissions.

India has a tax, but it’s chickenfeed at this stage.

Australia would not be “going it alone” if a carbon tax was introduced.

Next week, I’ll attempt to look at the projected outcome on global emissions of a tax in this country, placed in the context of global activity.

Wish me luck. This is about as much fun as having your wisdom teeth extracted.


I omitted South Africa and the Russian Federation, so read on -

South Africa 

South Africa has no carbon tax, but they’re talking big on action, if you read their National Government’s website. They’re also hosting the next Climate Change Conference in Durban in December this year, and Jacob Zuma has already made some political statements in preparation for this.

Russian Federation

In May 2009 Russia dramatically changed its policy on climate change. It officially accepted that anthropogenic global warming poses severe risks and stated that immediate action to limit carbon emissions was a priority. Their official assesment is here.

To date, that hasn’t led to any carbon tax legislation, but given its readily available supplies of natural gas, it’s expected that they’ll be encouraging the replacement of coal-fired power stations in favour of gas generated electricity.

Sunday, 5 June 2011

Hopefully More Light than Heat

There’s plenty of heat being generated by the carbon tax debate at the moment, but from where I sit, precious little light.

I’ll try, therefore to provide some light – it can’t do any harm.

I’m not going to argue the science. I’m not qualified. It’s a pity many of the opinionistas on both sides didn’t do the same.

Two examples from opposite sides are Andrew Bolt and Simon Sheik. Both are unqualified in the science, so when it’s all said and done, you’d be mad to listen to either of them. Having said that, on this topic, a lot more is being said than done. 

I’ll deal with one issue at a time. It’s a complex area, and I don’t have the time to research the fact across it all at once, so I’ll attempt to break it up into bite-sized chunks.

Boy on a Bike does this rather well IMHO. (See, I’m hip to all this blogspeak).

Today we’ll take a bite from the bit of the cake called “Countries that have introduced a carbon tax – did the sky fall?” You’ll also have to excuse a rather loose definition of “tax”.

My loose definition is “a financial penalty designed to encourage lower emissions of carbon”. So when I talk about a carbon tax – that’s what I mean. I’m not making judgements about whether it was effective or not – that comes later.

(Much later, actually – probably next week - I’m off to Thargomindah tomorrow).

The countries/states will be listed with some comments and references. Hopefully, you’ll be able to follow these up to test their reliability. I’m sure you’ll tell me if they’re dodgy. All I'm trying to do is to establish the fact of what the rest of the world is doing, as it seems to be an important part of the argument.

Let’s start with Europe – the UK to be precise. I'll look at North and South America next post.

United Kingdom

Way back in 1993, the Poms introduced what they called the fuel duty escalator (FDE), which was designed to reduce carbon dioxide emissions in the transport sector. The transport lobby hated it, and it was cancelled in 1999. In 2001, they introduced the Climate Change Levy. It was hoped to cut annual emissions by 2.5 million tonnes by 2010, and forms part of the UK's Climate Change Programme. It’s a tax bunged on all energy users, but the transport and household sectors are excused. On the carrot (as opposed to the stick) side, if you generate electricity from new renewables or cogenerational schemes, you don’t pay the tax. Nuclear is still taxed – that’s interesting.

You can check this out on the website of the quaintly named HM’s Revenue and Customs.
Let’s cross the dutch ditch and look at the Ditch Dutch.

The Netherlands

The clog wearers were quick off the mark in that they kicked off a carbon tax in 1990. That lasted only two years and morphed into something called the Environmental Tax on Fuels. This is a bit clever in that it is assessed on a split between carbon content and energy content. In 1996 The Regulatory Tax on Energy was added to the tax mix. The Environmental tax and the regulatory tax are/were 5.16 Dutch guilder, or NLG, (~$3.13) or per metric ton of CO2 and 27.00 NLG (~$16.40) per metric ton CO2 respectively. They don’t tax electricity, but they do tax fuels used to produce it. Energy-intensive industries were originally granted special rates, but these concessions expired at the beginning of 1997.
In 2007, the Dutch introduced what they call a Waste Fund that is funded by a carbon-based packaging tax. This tax encourages producers to create packaging that is recyclable. The goal is to of recycle 65% of used packaging by 2012. Tidy lot, the Dutch.
There’s a useful executive summary of European action (including the Netherlands) here.




Back in 1991 Norway introduced a CO2 tax on fossil fuels. It started at the very high rate of US$51 per metric ton of CO2 on petrol, with an average tax of US$21 per metric ton.  It covered diesel, mineral oil, and oil and gas used in North Sea extraction activities.  It is one of the highest rates in the OECD. Oil and gas produced offshore is also taxed. They generated US$1.3 billion in 2010 dollars by this. Some industry sectors have been granted exemptions from the tax to preserve their competitive position.
The Swedes first enacted a CO2 tax at the beginning of 1991 at $100 per tonne. It applied on the use of oil, coal, natural gas, liquefied petroleum gas, petrol, and aviation fuel used in domestic travel. Industrial users paid half the rate. There were exemptions for high-energy industries like horticulture, the pulp and paper industry, mining, and manufacturing. In 1997 the rate was raised to $150 per tonne of CO2. It’s paid in transport, space heating, and non-combined heat and power generation.
There’s lots of heating in Sweden. Here’s an article.




The land of the gnomes implemented a CO2 incentive tax on all fossil fuels in January 2008. Fuels used for energy were exempt as were petrol and diesel.  It adds up to US $11.41 per metric tonne of CO2. There is actually a Federal Law on the Reduction of CO2 (CO2 Law) in Switzerland. In 2010, the highest tax rate will be US $34.20 per metric tonne CO2.
Read more here.


Finland is notable because it was the first country in the 1990s to introduce a CO2 tax. They started with few exemptions for defined fuels or sectors, but substantial liberalisation has happened since then. When the Nordic electricity market opened further changes were made, because the Finns reckoned they would have been disadvantaged.

See page 17 here.

Republic of Ireland
The Paddies introduced their country's first in 2010 at approx US$20 per tonne of CO2 emissions.  It applies to kerosene, gas oil, lpg, fuel oil, and natural gas. Natural gas users are exempt if they’re using it to "generate electricity, for chemical reduction, or for electrolytic or metallurgical processes". The Economic and Social Research Institute has estimated the tax will cost between about €2 and €3 a week per household, or about €156 per year.
It’s controversial.

There’s a stoush in relation to heating charges for pensioners and people on fixed incomes, and of course the Irish economy is on life support.
To tidy up the rest of Europe, we look at Denmark where there’s been some form of carbon tax since 1992.  It was about $14 for business and $7 for households, per tonne of CO2 back then. Now it’s about $18 US dollars. The tax depends on the process the energy is used for, and whether or not the company has volunteered to apply energy efficiency measures.
The Danes also offer a tax refund for energy efficient changes. There are some details about Denmark here.

That’s a snapshot of Europe – a very light touch. I’m not into conclusions – that’s up to you.

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