The green shift requires more than a few cents in petrol tax / Columns / The Foreigner

The Foreigner The green shift requires more than a few cents in petrol tax. OPINION: This was supposed to be the year for the big green shift and delivery of promises of an “all-time high budget” for the climate and the environment. What we got in the recent state budget 2017 proposal was a few cents in petrol taxes. The state budget is the most important document from the government. It describes what the priorities are for the coming year and sets the direction for the country. For the entire 2013-17 parliamentary period, the government has promised to take Norway through the green shift where we become less dependent on oil and gas. You have to be an extreme optimist to find traces of the so-called green shifts in the proposed budget for 2017 that was presented last week. The government has pledged to cut greenhouse gas emissions by 40 percent by 2030. However, the state budget provides no answers as to how to do this. Actually, the emission projections in the budget are signalling a reduction of Norway’s emissions by only 2.1 percent in 2030, despite commitments to cut 40 percent in the same period. There are few, if any, traces of the large green shift needed for greenhouse gas emissions to be reduced. Without knowing how much emissions are going to increase or decrease, we will not know how the government will implement the green shift.

energy, environment, globalwarming, co2, tax, cars, oil, gas, globalwarming, budget, paywall



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The green shift requires more than a few cents in petrol tax

Published on Thursday, 13th October, 2016 at 21:07 under the columns category, by Nina Jensen.

OPINION: This was supposed to be the year for the big green shift and delivery of promises of an “all-time high budget” for the climate and the environment. What we got in the recent state budget 2017 proposal was a few cents in petrol taxes.



The state budget is the most important document from the government. It describes what the priorities are for the coming year and sets the direction for the country. For the entire 2013-17 parliamentary period, the government has promised to take Norway through the green shift where we become less dependent on oil and gas. You have to be an extreme optimist to find traces of the so-called green shifts in the proposed budget for 2017 that was presented last week.

The government has pledged to cut greenhouse gas emissions by 40 percent by 2030. However, the state budget provides no answers as to how to do this. Actually, the emission projections in the budget are signalling a reduction of Norway’s emissions by only 2.1 percent in 2030, despite commitments to cut 40 percent in the same period. There are few, if any, traces of the large green shift needed for greenhouse gas emissions to be reduced. Without knowing how much emissions are going to increase or decrease, we will not know how the government will implement the green shift.

The budget presentation took place in the same week as the ratification of the climate agreement from Paris. It is now for real. The world’s leaders are aiming for a maximum of 2°C warming, ideally no more than 1.5°C. The Paris Agreement does not dictate how countries should transition from fossil fuels to renewable energy, but it is obvious that the commitments require concrete action. The proposed state budget makes it seem as though Norway is leaving it up to everyone else to find the solutions.

If we translate the climate agreement from Paris, it means that no new fossil fuel sources can be developed. A new report from Oil Change International “The Sky’s Limit - why the Paris climate goals require a managed decline of fossil fuel production” shows that the world already exceeds the 2-degree target with the fossil fuels currently under production. All new exploration and new infrastructure are thus wasted investments if we are to attain the climate targets. This also means that if the Norwegian Prime Minister is serious about the agreement we just signed in Paris, and if she is serious when she says that climate change is one of the biggest threats we are facing, then we need to do something about our biggest emitter. If oil and gas nation Norway is serious about reaching the climate targets, this means no new developments or searching for new oil. The best way to illustrate a green shift in the budget would be to remove the privileges for the oil industry.

Norwegian oil companies have very favorable arrangements for depreciation, interest expenses and so-called uplift (friinntekt). These arrangements are an indirect investment support, and according to the National Budget, in 2016, this amounts to total of NOK 14.4 billion (about USD 1.75 billion at today’s ROE) compared with what a neutral tax system would provide.                                            

However, there is no mention of oil and gas in Prime Minister Erna Solberg and Minister of Finance Siv Jensen’s green tax package. Their green tax package, and their ultimatum to the coalition partners, is a few cents (øre) in increased petrol taxes. Apparently, 35 Norwegian cents for diesel and 15 Norwegian cents for gas is all that they have to offer as a green shift. At the same time, they are providing beneficial tax relief for motorists through increased travel allowances, lower annual fees on cars and reduced tolls - a package that will actually result in a total cost reduction for the motorists and an estimated increase in overall emissions from the transport sector. Yes, green taxes matter, but they have to be big enough to stop the polluting activities and benefit the green activities for them to make a difference. Instead, the so-called green shift has been reduced into a discussion about a few cents  in increased fuel taxes.

In Norway, we stand at a crossroads. Norway has lived well off the oil and gas industry, which has provided income to support the very foundations of our welfare state. However, fossil fuels have largely created the climate crisis that the world is now facing, and there is no doubt that Norway must change its course. Transitioning from fossil fuels to renewables is vital to stop climate change and contribute to continued development and future jobs. Norway both has to transition to a greener future where energy sources are renewable and do not cause climate emissions, and contribute to bring the rest of the world in the same direction. Parliament now has a huge job ahead to pull the budget together to where it needs to be, and show that Norway is actually serious about climate change.

There are three specific measures to correct the direction: 1. We need climate budgets describing where emissions are coming from, where they will be cut, and their projections until 2030. 2. We need a complete cut in subsidies and beneficial taxation regimes for fossil fuels. 3. We need increased investments in the future that we want; such as increased forest protection, and support to new ocean initiatives including offshore wind. This will generate new jobs and new income streams in the years to come.

This was the last opportunity the present government had to show that they are serious about climate change. They failed.

Nina Jensen is General Secretary of WWF Norway.




Published on Thursday, 13th October, 2016 at 21:07 under the columns category, by Nina Jensen.

This post has the following tags: energy, environment, globalwarming, co2, tax, cars, oil, gas, globalwarming, budget, paywall.





  
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