GREENBUDGETNEWS NO. 10 –12/2004

EUROPEAN NEWSLETTER ON ENVIRONMENTAL FISCAL REFORM

Editors:

www.eco-tax.info www.eeb.org www.ecocouncil.dk www.levego.hu www.oegut.at

Contents

1. EDITORIAL ...... 1 2. GREEN BUDGET REFORM ON EU-LEVEL ...... 2 3. GREEN BUDGET REFORM IN SINGLE EUROPEAN COUNTRIES ...... 3 4. GREEN BUDGET REFORM WORLDWIDE...... 12 5. EVENTS...... 21 6. LINKS AND PUBLICATIONS...... 21 7. READERS’ GUIDE AND IMPRINT ...... 24

1. EDITORIAL

Our first piece of good news is that, as from this http://www.eco-tax.info/4fakten/index.html. issue, we have a new cooperation partner for This was not all, however: Green Budget Ger- Green Budget News – the European Environ- many released its Scholar’s Declaration in favour mental Bureau (EEB). We are looking forward to of the further development of the ecological tax a more varied selection of articles than ever before reform to the press in Berlin on 16th November and are of course delighted to welcome them on and received significant media coverage, as you board. Our second piece of good news is that we can see below in the selection of articles we have are pleased to report our considerable presence in translated for our English readers. As well, the the German press over the past two months. This Federal Environment Agency commissioned a was due to a number of combined factors, not study from the German Institute of Economic Re- least the publishing of Green Budget Germany’s search, which revealed what we at Green Budget second edition of the 2004 memorandum on the Germany have long suspected: many sectors of further development of ecotaxes in Germany, of German economy were and continue to be net which an English version is now available online winners from the ecological tax reform. and can be downloaded from our website at: As always, the newsletter also takes a look at de-

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velopments from around the world, the most posi- transport-commissioner-designate Jacques Barrot tive development being, of course, that Russia has has suggested that a tax on aircraft fuel for EU- finally ratified the Kyoto Protocol, which will internal flights be introduced. We await further now come into force on 16 February 2005. On a developments in this respect with great interest! less positive note, this has not moved the Austra- We hope you enjoy this issue of GreenBudget- lian government, which maintains that it under- News – and don’t forget that contributions for the takes more than Kyoto on a unilateral basis – a next issue and comments from our readers are al- poor excuse not to engage in multilateral action, ways welcome. or so it would seem. Within the European Union, Your editors. kerosene tax is once again on the agenda, as EU

2. GREEN BUDGET REFORM ON EU-LEVEL

clearly set out and the possible economic impact New EU transport chief suggests kero- identified," secretary-general Ulrich Schulte- sene levy Strathaus said. Turning to other issues Mr Barrot said stricter measures were needed on ship source [Environment Daily 1739, 04/10/04] EU transport pollution, currently exempt from the EU's envi- commissioner-designate Jacques Barrot has sug- ronmental liability directive: "the borderlines of gested that the bloc introduce a tax on aircraft fuel civil and criminal responsibility are not that clear for internal flights. The Frenchman's remarks at a [...] we have to sort out the ethos of responsibil- hearing before MEPs last week have put back on ity," he said. the EU agenda an idea rejected by the current European Commission five years ago. "Would it Meanwhile, energy commissioner-designate not be possible to introduce a low rate of tax on László Kovács put in a lacklustre first perform- intra-community flights which are not exposed to ance before MEPs on Thursday, several times international competition?" Mr Barrot admitting that he did not know enough about his said. However, the tax could only be introduced portfolio. The Greens called his hearing "an of- "when fuel prices have settled down" and would fence to the parliament." The Hungarian candidate have to take account of both competitive and envi- commissioner expressed interest in a European ronmental effects, he added. green certificate trading scheme for companies in- vesting in renewable energy. But he said it was Mr Barrot's comments revive the kerosene tax de- not for the Commission to impose legally binding bate as governments meet in Montreal, Canada, to targets for renewable energy on member states. discuss international guidelines on using eco- He made several comments supportive of nuclear nomic instruments to combat aviation's environ- power, drawing a welcome from European atomic mental effects. The EU is fighting US proposals to industry association Foratom. outlaw all instruments except emission trading. Kerosene taxes were ruled out as a policy option Links: European parliament by the Prodi commission in 1999. In a policy http://www.europarl.eu.int/ document it said different permutations of the tax Press releases from AEA would either hit domestic airlines' profits too hard http://www.aea.be/aeawebsite/datafiles/jbarrot or produce negligible environmental benefits. 1004.htm and the Greens-EFA "What [Mr Barrot is] saying is very encouraging," http://www.greens- Jos Dings of campaign group Transport & Envi- efa.org/en/press/detail.php?id=2046&lg=en ronment told Environment Daily. "It's finally a recognition of the arguments that many people EU's Kyoto "linking" law enters into wanting an economically and environmentally force sound transport policy have been favouring." Air- line association AEA was also "encouraged" by [Environment Daily 1769, 16/11/04] Legislation Mr Barrot's hearing, but hedged on the kerosene allowing firms involved in the EU emissions trad- tax. "The environmental objectives should be ing scheme to gain extra carbon credits by funding abatement projects outside the bloc entered force

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in early November as it was published in the EU Berlin on international cooperation on global cli- official journal. mate change while on a state visit to Germany in Member states must now transpose the so-called early November. "This conference is evidence of "linking directive" by 13 November 2005. The British and German leadership in the field of cli- law will apply to EU plants with emission caps mate change which has its roots in the close co- under the emissions trading scheme. They will be operation already existing between the Potsdam able to reap extra allowances through the Kyoto Institute for Climate Impact Research and the protocol's flexible mechanisms. Combined with Tyndall Centre in Britain," she said in her speech, Russia's recent decision to ratify the protocol, the delivered at the British-German Climate Change directive significantly alters the market landscape. Conference in Berlin during the state visit to her Its intended effect is to "increase the diversity of grandfather’s ancestral homeland. low-cost compliance options" and "improve mar- ket liquidity", according to the law's preamble. Coming on the day that President Bush’s victory The content was settled politically in April and the in US elections was announced, soon after the text finalised in September. Russian decision to ratify the Kyoto Protocol and just weeks after the UK Government’s changes to Starting in 2005, firms will have direct access its targets for the EU emissions trading scheme – through the Clean Development Mechanism to seen by many as backsliding – the speech on cli- credits from countries not subject to Kyoto emis- mate change marks a rare incursion by the Queen sion reduction targets. From 2008 joint implemen- into domestic and international politics. UK and tation credits will be available from those coun- German politicians spoke of their intended coope- tries that do have targets (principally Russia). ration in climate change action at the conference. Firms cannot gain credits by funding nuclear or "Climate change has the capacity to reshape our sinks projects, though a review in 2006 might lives dramatically... (which) shows how important open the door to robust sinks schemes. The same cooperation is between nations and the need for review might also allow extra allowances from leadership," UK Environment Secretary Margaret funding projects at home. Investments in hydro- Beckett said at the British-German Climate Chan- power plants bigger than 20 megawatts must ge Conference in Berlin. Beckett promised again comply with guidelines from the World Commis- that the U.K. would strongly advance the climate sion on Dams. change agenda during its chairmanship of the There is no EU-wide limit on the number of extra Group of Eight leading nations in 2005 and also credits firms can gain, but authorities must set na- presidency of the EU in the second half of 2005. tional limits, in the form of a percentage of the She highlighted the common approaches to envi- number of allowances allocated centrally by gov- ronmental issues shared by the U.K. and Germany ernments. The Commission may later propose a and pledged further bonds between the two count- harmonised limit if it thinks too many external ries in the fields of climate change, climate scien- credits are being sucked into the market and pre- ce and technology. Beckett said the drive to redu- venting efforts to abate emissions inside the EU. ce carbon dioxide emissions by 60 percent by 2050 could be lucrative, especially as more and British Queen wades into climate change newer technologies lower the costs of being green. debate The conference will present proposals to the UK prime minister Tony Blair and German Chancellor [Point Carbon, 04/11/04] The British Queen Eli- Gerhard Schroeder on future cooperation to com- zabeth II has thrown her weight behind efforts to bat and adapt to climate change. slow greenhouse gases by opening a conference in

3. GREEN BUDGET REFORM IN SINGLE EUROPEAN COUNTRIES

Germany:More than 130 scholars an- [Translation by Berivan Pont, Green Budget nounce green budget reform must be fur- Germany Press Release, Berlin, 16/11/04] More than 130 scholars came out in support of the pur- ther pursued. suit of ecological tax reform in Germany in an

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open declaration in Berlin on 16 November 2004. able criticism from the first five years of the eco- The declaration, presented by Green Budget Ger- logical tax reform in Germany, research has many, called for concrete steps to allow the re- shown that the reform has had a positive impact form to progress. Prof. Claudia Kemfert, signatory on both the environment and the economy. This is of the declaration and departmental head at the the conclusion reached by a new report published German Institute for Economic Research said, by the German Institute for Economic Research. “Research shows that ecological tax reform takes The Institute’s research confirms that the reform, pressure off the environment and creates jobs. Our which set out to protect the environment and cre- economy depends too heavily on crude oil price ate or secure employment, has been broadly suc- variations. Ecological taxes help Germany free it- cessful in achieving its aims and steering eco- self from its oil addiction. Regrettably, the nu- nomic development in the right direction. More merous winners from the ecological tax reform than half of the people interviewed for the report tend to maintain dignified silence, while those stated that they have been more careful about en- who lose out polemize against it. We seek to in- ergy use and energy saving since the introduction troduce a more factual aspect to the debate with of the reform. The introduction of innovative en- our research results.” ergy-saving methods is subsidised for businesses, Prof. Martin Jänicke, signatory of the declaration which also benefit from the reduction of pension and member of the Parliamentary Environmental payments. Social insurance payments could be re- Audit Committee in Germany, said; “Due to high duced by approximately 8 million Euros annually crude oil prices, a rational decision has been made as a result of the reform. The main winners from not to raise fuel taxes up for the time being. But the ecological tax reform included the manufac- the Federal Government must abolish tax privi- turing and service industries. leges for diesel, air traffic and industry. Employ- The principle of the reform - to make energy more ees from Karstadt to Opel are under a great deal of and labour less expensive - thus had a dual im- pressure because of high social insurance. Reduc- pact: tions in social insurance by means of an ecologi- • more expensive energy creates incentives cal and social financial reform, including the abo- to save energy, which in turn results in lition of subsidies, is a preferable alternative to an protection of limited resources and the increase in value-added tax.” climate, and By the end of the year, according to the coalition • 90 percent of thus funds raised by the tax agreement between the SPD and the Green party, was paid into the pensions fund to reduce the parties will have made a decision on the future pension payments, which makes labour development of ecological tax reform in Ger- cheaper and stimulates employment. many. In 1999 when the ecological reform tax reform Green Budget Germany is an organisation whose was introduced, it was agreed that the reform members include scholars, entrepreneurs and rep- should continue in five stages until 2003. In addi- resentatives from environmental organisations and tion, the law on the further development of the NGOs; it has lobbied for a comprehensive eco- ecological tax reform came into force in 2003, and logical financial reform for the past ten years. work on an ecological finance reform was begun The declaration (in German) and its signatories and continued in 2004. The reform introduced a can be viewed at: tax on fuels and electricity, which was gradually http://www.foes.de/3aktuelles/pressemit0411 increased in five stages over five years, and on light heating oil and gas (although the former was 16.html only included in the first stage, the latter only in the fifth and final stage). At the same time, pen- German Institute for Economic Research sion contributions were reduced by 0.8 percent – gives Ecological Taxation the Thumbs from 20.3 percent in 1998 to 19.5 percent in 2004 Up – for both employers and employees. Thus, em- ployment became cheaper for employers, and em- [translation by Jacqueline Cottrell, Green Budget ployees took more money home in their purse. Germany, from the FRG Government homepage, Without the ecological tax reform these contribu- link below, 18/11/04] In the face of the consider- tions would have reached levels 1.7 percent higher

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than their actual percentage value in 2004 – i.e., Report Highlights the Advantages of they would have amounted to 21.2 percent. as a Ecotax result of demographic and cyclical economic de- velopments. [translated by Jacqueline Cottrell from an article in Frankfurter Rundschau, 17.11.2004] Ger- In the research paper the following effects could many’s Federal Environment Agency has pub- be proven: lished a report stating that the ecotax has reached • In private households, the ecological tax its target and demanding the establishment of a reform proved to be a strong or very broader ecological fiscal reform. According to the strong motivation to save energy for ap- Environment Agency, the ecotax has advantages proximately half the persons interviewed for business and employees amounting to billions for the report. This included in particular of Euro – a much better outcome than its reputa- electricity consumption, heating (includ- tion would lead one to expect. The experts defend ing home insulation), and mobility, par- the ecotax as a steering mechanism for business ticularly fuel savings. and politics in their report. • In business, the effects of the ecological The tax on petrol, diesel and other energy sources tax reform were many. Personnel- introduced in 1999 certainly works as it was in- intensive companies benefited directly tended, argued Andreas Troge, president of the from the reduction to pension payments. Federal Environment Agency (UBA). The aim of Energy saving mechanisms in business the ecotax was to cut energy use and relieve the and the availability of energy-efficient pensions fund – and, according to representative products (such as energy-saving build- surveys and research carried out by the Berlin In- ings) also enabled companies to benefit stitute Ecologic and the German Institute for Eco- from the reform. The increased demand nomic Research (DIW) – precisely this has been for new services, such as energy consult- achieved. A representative survey carried out by ing firms, also had a positive impact on Ecologic in September 2004 revealed that half of employment. those asked have been more aware of their energy • Up to 2002, businesses gained overall consumption since the introduction of the ecotax. from the reform. Alongside service indus- The Environment Agency’s report also revealed tries, according to the calculations of the that economy has profited – ecotax benefited in- German Institute for Economic Research, novative, energy-saving companies and clearly manufacturing industries can also be re- reduced ancillary wage costs. Since 2003, there garded as one of the biggest winners un- have been developments in some economic sec- der the reform in 2002, benefiting from tors that make it clear that the tax must be further net relief amounting to approximately half developed for it to continue to be effective. a million Euro. Ancillary wage costs fell, according to the study, This situation changed as a result of the reduction by approximately 8 million Euros annually. Al- of tax relief from ecological tax in 2003. Thus, most 90 percent of all funds raised by the tax were companies did indeed face a small tax burden as a paid directly into the pensions fund, to reduce result of the reform by 2003 – the agricultural and pension payments. Without the ecotax, pension haulage industries paid more than they received in payments in Germany today would be 1.7 percent pension relief. All other production sectors re- higher than their present levels – not 19.5 percent, mained winners under the reform in 2003, as did a but 21.2 percent. large portion of the service sector, such as health insurance and credit card companies. Business bore a small burden in 2003 A large number of companies spoke in favour of The studies also prove that the ecotax has a posi- continuing and developing the ecological tax re- tive effect on the environment, argued the Federal form in the survey, because they can expect larger Environment Agency; 53 percent of car drivers gains in the future as a result of continuing reduc- stated they drove more slowly than before and left tions to social insurance payments. their car at home on occasion as well. Almost The original text can be accessed at: three quarters of those surveyed switched electri- cal equipment completely off, rather than leaving http://www.bundesregierung.de/- it in wasteful stand-by mode. ,413.746534/artikel/Oekosteuer-zeigt-positive-Effe.htm

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Up to 2002, business was a net winner from the have ecotaxes at 2.84 percent of GNP, in Ger- reform. Alongside service industries, manufactur- many they amount to only 2.58 percent. ing industries were the most significant net win- The Green party in Germany has made an effort to ners by almost half a billion Euros in 2002. The draw attention towards these surprising figures. In situation for these sectors changed in 2003, how- Green party circles, the Greens have been discuss- ever, because tax relief was reduced and the extra ing whether they should call for increases to eco- monies were used for “general consolidation of taxes – against the official government line – ever the budget”. Thus, businesses could not profit di- since the report was published. Unofficially, in- rectly from this development, as the funds raised creases have particularly been discussed in rela- were not used to reduce pension payments. tion to ecotaxes on heating oil in Germany, which As a result, businesses overall bore a “small bur- is taxed at only 6.2 cents per litre (far below the den” in 2003 due to the ecotax. Agriculture and tax rate in Denmark or Italy) – seeming to leave traffic paid more in ecotax than they received in considerable room for improvement. pension relief; all other sectors remained net win- However, no consensus has been conclusively ners overall. A large proportion of service indus- reached within the Greens. Their policy course tries such as health insurance and credit card should be defined in consultation with experts, ar- companies were amongst the net winners from the gue party leader Reinhard Bütikofer and ecotax in 2003. Reinhard Loske, leader of the Green group in The report is based on on representative surveys parliament. This meeting was unofficially sched- and research carried out by the Berlin Institute uled for the beginning of November. Also invited Ecologic and the German Institute for Economic were president of the Federal Environment Research (DIW), whose researchers recommended Agency, Andreas Troge (CDU), the chief developing the ecotax as a broader ecological fis- economist of the Deutsche Bank, Norbert Wal- cal reform, to dismantle environmentally damag- ter, and the Regensburger Economics professor ing and economically questionable subsidies and Wolfgang Wiegard. Wiegard is not only chair- tax relief mechanisms, including tax relief for man of the five chief economic advisers of the commuters. government but also – as is Walter – a member of In contrast to Troge, numerous scholars have the Advisory Board of Green Budget Germany. called for further increases to ecotax rates. The Green Budget Germany recently published a new monies raised from these increases should no memorandum calling for further increases to eco- longer flow into the pensions fund, but into the taxes in Germany, such as an increase in the tax general budget. “The ecological tax reform is an on heating oil of 2 cents per litre annually and of 3 essential instrument for environmental protection, to 5 cents on fuels. employment and innovation”, stated more than 130 scholars in a Green Budget Germany declara- German Federal Environment Agency tion published on 16 November 2004. and Professors LINK: http://www.fr- in favour of further ecological tax re- ak- form tuell.de/ressorts/wirtschaft_und_boerse/wirtsc [translated by Jacqueline Cottrell from an article haft/?cnt=590498& from the German Press Agency, Berlin, 17/11/04] According to a survey, the ecological tax reform Low Ecotaxes in Germany has prompted more than half of all German citi- [translated by Jacqueline Cottrell from an article zens to make moves to save energy, while driving by Fritz Vorholz, Die ZEIT of 28/10/04] An and at home, in terms of both heating and electric- OECD report, thus far scarcely noticed in Germa- ity consumption. This was revealed in a represen- ny, still has the potential to cause an uproar. Ac- tative survey published by the environmental in- cording to the comparative study that examined stitute Ecologic in Berlin on 16 November 2004. the tax systems of the 30 member states of the or- Almost three quarters of the 1002 people inter- ganisation, ecotaxes put less strain on business in viewed had taken measures to save motor fuels in Germany than its most significant neighbouring response to the reform. One fifth often decided to countries. While the 15 old EU member states leave their car at home and to use other alternative

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methods of transport instead to save on fuel. the necessity for ecological modernisation and in- The survey was commissioned by the Federal En- ternational competitiveness for German business. vironment Agency in Germany. Its president, An- Both politicians are leaders of the coalition's dreas Troge emphasised that it is clear that the working group, which was created to make sug- ecological tax reform, introduced in 1999, cer- gestions for further develop of ecological tax re- tainly influenced behaviour in the right direction. form next year. The debate does not centre on a The ecological tax reform, he stressed, must be possible increase in tax rates. Rather, the debate developed into a more encompassing ecological will focus on the tax reductions for energy- finance reform by dismantling environmentally intensive businesses currently in place. They cost damaging subsidies such as tax reductions for the Federal Ministry of Finance 5.6 billion Euros commuters. per year and correspondingly benefit the indus- In contrast to Troge, numerous academics have tries that consume large amounts of electricity, published a declaration in favour of increasing the such as steel and aluminium manufacturers. rate of the current ecological tax reform. The While the coalition wishes to tackle the project, monies raised, they argued, should no longer be there is some resistance within the government. earmarked for pension reductions, but should flow Federal Minister of Economics and Labour Wolf- into the general budget. The ecological tax re- gang Clement (SPD) has already spoken out form, they argued, is an essential and indispensa- against the removal of such subsidies, as he fears ble instrument for environmental protection, em- energy-intensive industries will relocate abroad. ployment and innovation. The declaration, in- The two groups recently received support from spired by Green Budget Germany, was signed by the German Environmental Agency and leading more than 130 scientists and leading academics. German academics. The ecological tax reform is, Links: according to Andreas Troge, president of the http://www.bundesregierung.de/- Agency, "better than its reputation". Troge re- ,413.746534/artikel/Oekosteuer-zeigt-positive- ferred to a new report published by the German Effe.htm Insitute for Economic Research. According to the http://www.umweltdaten.de/uba-info- institute, social insurance payments could be re- presse/hintergrund/oekosteuer.pdf duced by 8 billion Euros annually by means of the taxes on petrol, diesel and electricity. According Coalition has its Eye on Ecotax to Troge, without the ecotax, which flows largely into pensions, pension payments would be at 21.2 [translated by Jacqueline Cottrell from an article percent and not their current rate of 19.5 percent. by Jörg Michel, Berliner Zeitung, 16/11/04] The The German Institute for Economic Research re- coalition partners in the German government have ported that business has been relieved as a result decided to examine the ecological tax reform and, by approximately half a billion Euros and noted more specifically, the subsidies for energy- that the manufacturing industry and services in intensive industries. "We should dismantle these particular have profited from the tax. Troge too special provisions", vice-president of the Green spoke out in favour of reducing the environmen- group in parliament, Reinhard Loske, told Ber- tally damaging and economically questionable tax liner Zeitung. He also spoke out in favour of using relief for business. the monies thus raised to finance environmental policy programs – for example, for better heat in- A broadly-based alliance of more than 130 aca- sulation or to promote electricity-saving technolo- demics also published a statement in favour of in- gies. creasing the ecotax. “The ecotax is an essential in- strument for environmental protection, employ- Michael Müller, vice-president of the SPD in par- ment and innovation”, states Green Budget Ger- liament, agreed. "We should promote environ- many’s academic declaration published on 16th mentally friendly innovations with the extra taxes November in Berlin. The additional monies raised raised". The special provisions of the ecological should flow into the general budget. The research- tax reform were only accepted by the EU on con- ers called for the dismantling of tax relief within dition they were temporary, he pointed out, saying the ecotax system. that they would have to be "re-examined" soon in any case. We need to find a fair balance between http://www.berlinonline.de/berliner- zeitung/politik/395731.html

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German government to attack ecotax Hungarian NGOs Demonstrate for exemptions Green Budget [Environment Daily 1770, 17/11/04] Germany's [András Lukás, EFR, 21/10/04] Seventy-two en- SPD and Green governing parties are considering vironmental NGO’s demonstrated before the a dramatic reduction of energy tax exemptions for Hungarian Parliament on 21October,2004. They energy-intensive firms as part of their current re- demanded the greening of the state budget. They view of country's ecological tax reform (or eco- handed over a petition to a representative of the tax) programme. Prime Minister (see the text below). On 3 No- A source at the Greens told Environment Daily vember 2004, representatives of five environ- that officials from the SPD-Green coalition have mental NGOs handed over a complaint to the agreed that the tax breaks, which are worth €3bn, chairman of the Parliamentary Committee on had to be scaled back. More than two years ago, Constitution and Justice. They pointed out that the the government decided to spare several energy- state budget bill contradicts several paragraphs of intensive sectors the full brunt of the ecotax. the Hungarian Constitution and other laws. Among other things, no information was given The source acknowledged that rolling back the about indirect subsidies, although this is required exemptions might face opposition from Wolfgang by the law on the state budget. On 5 November Clement, the pro-business SPD economics minis- 2004, the Environmental Committee of the Hun- ter. Mr Clement has already locked horns with the garian Parliament held a consultation on next Greens over the ecotax programme and renew- year’s state budget plans. More than 20 environ- ables support, arguing that the former may be un- mental NGOs were represented at the event. An- necessary due to emissions trading and that the drás Lukács, president of the Clean Air Action latter was too high. Group held a presentation about the possibilities But the source said that as Hans Eichel, SPD fi- of a green budget reform with concrete proposals nance minister, backed the idea of reducing ex- for the 2005 state budget. This was followed by a emptions, there was a good chance of it going discussion among the NGO representatives and ahead. He ruled out any additional hikes in the members of the Parliament. ecotax, saying that, instead, coalition officials were looking into extending the scope of carbon Petition to Prime Minister Ferenc Gyurcsány emissions trading to include more German firms. concerning Hungary’s State Budget for 2005 In a related development, pro-ecotax lobby Green Mr. Prime Minister, Budget Germany said 130 scientists had signed a We, the undersigned Hungarian non-government petition urging the government to further develop organizations, hereby express our grave concern the ecotax programme. Martin Jänicke, who about the 2005 state budget and tax bills. We be- serves on the government's panel of environ- lieve that passing these bills in their present form mental experts (SRU), said that although the eco- may seriously jeopardize several achievements tax should not, amid high oil prices, be raised for reached through general consensus of the Hungar- the time being, the government should "end tax ian society, may infringe upon the constitutional breaks for diesel users, airlines and other indus- right of citizens for a healthy environment, and tries." may severely disturb the operation of the coun- try’s non-governmental sector. LINKS to other recent articles on ecological tax reform in Germany: We are fully convinced that the 2005 Hungarian state budget should better support environmental 1) Die Tageszeitung (taz): and nature protection, education, culture, health- http://www.taz.de/pt/2004/11/17/a0154.nf/text care, scientific research and development, build- 2) AP, 16.11.2004; German Federal Environment ing renovation, energy efficiency, public trans- Agency praises the advantages of the ecological port, railway transport, and ecological forestry and tax reform: see: farming. We think that it is also indispensable to http://de.news.yahoo.com/041116/12/4apol.html grant increased subsidies to state agencies which 3) Financial Times Deutschland: have the primary function of ensuring an unspoilt, http://www.ftd.de/pw/de/1100336578996.html?nv safe environment and the purity of public life in =se Hungary: in other words, it is necessary to

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strengthen the environmental and nature protec- ion. tion authorities, the National Public Health and With a view to cutting back the squandering of ar- Medical Officer’s Service, and the National Board able land, one of Hungary’s most valuable and ir- of Customs and Finance Guard, among others. In replaceable assets (by covering it with concrete or our opinion, it is essential to safeguard, utilize and asphalt, and building it up virtually without any further develop the results that the Hungarian civil limits), and to curbing the related massive real sector has already attained. property speculations and corruption, it is neces- We find it particularly alarming that the budgetary sary to set true prices for arable Hungarian land subsidies of the Ministry of Environment and Wa- (for instance by significantly raising the amount ter are scheduled to be cut. Serious environmental and extending the scope of the land protection accidents of the past few months have demon- fee). strated that the failure to strengthen the work of The Hungarian housing subsidization system Hungarian environmental and nature protection should be transformed so that the construction of a authorities puts at risk the health and life of citi- new home should only receive support if it meets zens. Additionally, at the time of the EU acces- strict environmental protection preconditions. In sion, Hungary was undertaking a series of envi- the long run, this may result in annual savings of ronmental protection obligations that make it in- several hundreds of billions of HUF for the state dispensable to extend the staff of the regional and for local governments. agencies – as promised by each one of the succes- Hungary should start removing the preferences, sive Hungarian governments to both the European worth hundreds of billions of HUF a year, given Union and domestic electors. to heavy truck transport (those operating heavy A shockingly short-sighted approach is mani- trucks should pay for the damage that can be fested in the fact that the present draft budget con- proved to have been caused by them). tains virtually no estimate at all for a domestic The huge subsidies granted to car transport in competition system making funds available for Hungary should be gradually withdrawn. (Among public purposes and for environmental protection other measures, the Hungarian state should put an developments; only for the amounts of the Hun- end to the possibility of writing off private car use garian contribution to large investment projects as a company expense item. This unlawful method subsidized by the EU. Consequently, local gov- has become widely used in Hungary, taking away ernments, the media, enterprises, schools, NGOs revenues of hundreds of billions of HUF from the and scientific institutions are currently only to re- state budget year after year.) ceive insignificant subsidies, if any, for activities such as environmental education, social awareness The forced-rate programme of extending the Hun- raising, scientific research and development, the garian high-speed road network should be aban- protection of endangered species of animals and doned. plants, the establishment and maintenance of Fuel smuggling and fuel tourism should be cut waste prevention and utilization systems, the back by imposing strict measures. elimination of illegal waste dumping sites, or the In the system of bearing the costs of waste dis- elaboration and implementation of local govern- posal, the “polluter pays” principle should be con- ments’ environmental programmes. sistently applied and the responsibility of indus- Moreover, the Hungarian state budget includes tries and commerce should be enforced. The prior- harmful and unnecessary subsidies worth hun- ity of prevention should also be ensured through dreds of billions of HUF; the withdrawal of such legal and economic instruments (e.g. through the subsidies would allow support to be granted to the decree on deposit charges, already in preparation above goals. In order to raise the required funds, for a decade, and by developing the system of we make the following proposals: product charges). Subsidization of intensive and highly chemical- The black market should be forced back in Hun- ized agricultural production should be considera- gary (e.g. by increasing the subsidies granted to bly reduced. This is also important because by the afore-mentioned state authorities and agencies giving preference to the agrarian environmental and by making them more interested in attaining protection programme Hungary may obtain sig- this goal). nificantly more subsidies from the European Un- The prices of exploited Hungarian mineral re-

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sources should reflect the costs of the environ- Nation-wide road pricing back on Dutch mental damage caused by their production and the agenda fact that these raw materials are non-renewable (this can be achieved by raising the payable rate [Van Anaar Beter, nota mobiliteit, 19/11/04] The of mining tax). policy document 'Nota Mobiliteit' defines the key elements of the Dutch transport policy for the next Through issuing appropriate implementing de- decade. The starting point is that mobility is a pre- crees it should be made possible to collect, at long requisite for economic and social development. A last, the 25 percent cultural contribution imposed properly functioning system for passengers and by the law upon products involving violence and freight transport and reliable accessibility to our pornography. national and local networks are essential to Mr. Prime Minister, strengthen the economy and the international Hungarian environment and nature protection competitiveness of the Netherlands. NGOs are interested in creating an up-to-date The government believes that an alternative knowledge-based economy, and so they represent method of paying for road use is necessary to im- a key driving force of social development. We re- prove reliability, reduce journey times, and thus quest you to endorse our proposals and to initiate strengthen the economy. The government is there- the modification of the 2005 state budget and tax fore making all the necessary preparations to pave bills. the way for the introduction of road pricing by the Pictures of the demonstration can be seen at: next government, without already committing it- http://www.indymedia.hu/kepgaleria.shtml?x=187 self to a specific type of road pricing. The system 61 must be effective, efficient, robust and socially vi- able. This demands widespread support within so- Norway ups the stakes on natural gas ciety at large. Not only for road pricing in general, but also for the actual method used, which is pre- [Environment Daily 1742, 07/10/04] The Norwe- cisely where the ideas diverge. To achieve this gian government on Monday submitted budget consensus, the Paying for Mobility Platform was proposals for 2005 featuring heavy investment in set up. This Platform is to come up with a CO2-free natural gas power generation. Tax in- broadly-supported road pricing proposal in the centives to encourage the introduction of sulphur- early spring of 2005. This proposal, the outcomes free petrol and diesel are to be introduced. of the consultation with other authorities, the re- Norway's "energy fund" to promote energy sav- sults of the interdepartmental policy study on ing, renewables and natural gas will receive an “Gebruiksvergoedingen Goederenvervoer” (Road additional NKr95m (EUR11m), up 17%. Its target Pricing for the Road Haulage Sector) and the reac- for increased environment-friendly energy pro- tions to consultation will be incorporated in PKB- duction and saving is being increased to 12 TWh 3 (Core Planning Decision) of the Mobility Policy per year by 2010, a 2 TWh increase over the pre- Document. vious target set in 2002. NKr150m will be made To read more about the Dutch transport policy go available for R&D on CO2 sequestration. A to: http://www.vananaarbeter.nl/NotaMobiliteit/ NKr2bn fund for environmentally friendly gas technology set up earlier this year is expected to return about NKr46m as part of a proposed "na- Environmentally harmful subsidies in tional gas technology programme". Total alloca- Poland – Case Studies tion for the environment ministry rises 3.5% to [Wojciech Stodulski, Institute for Sustainable De- NKr2.7bn. Priorities are identified as outdoor rec- velopment, Poland] Coal plays an important role reation, cultural heritage and forest conservation. in the Polish energy sector. Since the early 1990s, An extra NKr14m is earmarked for cleaning up the government has been introducing successive polluted ground, water and sediments in order to restructuring programmes for the sector aimed at complete work on 100 priority sites, and inspec- decreasing production capacity and employment, tions of 500 more, next year. and hence the achievement of profitability for Pol- Follow-up: Norwegian finance ministry ish coal mining. http://odin.dep.no/fin/

GREENBUDGETNEWS NO. 10 PAGE 11 OF 25

Coal Mining lions USD at the end of the 1990s. The authors In 2002, hard coal made up 73.85 percent and lig- also indicate other specific forms of subsidising nite 15.15 percent of total primary energy produc- the hard coal production, which are related to the tion in the country (in 1992: 80.77 percent and organisational structure of hard coal branch. Be- 14.53 percent, respectively). Although domestic cause the mines have been merged into the coal extraction has declined by 24 percent since 1995 companies consisting of a few up to approx. 15 (see table 1), Poland is still ranked high (7th) plants, the most effective and profitable mines are among the world’s hard coal producers. granting subsidies from their revenue to the weak- est ones. However, a calculation of cross- Table 1. Production of hard coal (in millions subsidisation within particular coal companies is tonnes). practically impossible because no official statisti- cal data are available on the subject. Furthermore, 1995 2000 2001 2002 coal companies have an interest in hiding such 137 103 104 104 data because revealing it would lead to increased

corporate taxes. A slight decrease in the above-mentioned figures is also reflected in the total employment in the The recent favourable situation on the world coal branch (see table 2), yet coal mining remains one market has improved the economic situation of of the biggest burdens on the Polish state budget. some coal mines, raising questions about the ra- tionale for maintenance of state support for profit- Table 2. Mining of coal and lignite - jobs (in able companies. The Ministry of Economy and thousands). Labour is considering a withdrawal of financial 1995 2000 2001 2002 support for selected mines but faces strong resis- 294.5 174.3 171.5 166.9 tance. According to the Ministry, profits from the market boom should be earmarked to finance nec- The most popular forms of state aid have been in essary reforms, and state support could not be the form of direct grants and debt relief, which consumed by the increase of wages of miners. amounted to 15 billion PLN for this sector in This aim is underlined in a governmental plan of nominal prices in the 1990s, i.e. 34 billion PLN at access to the deposits, while the plan contains a 2001 prices (in comparison, total state aid has re- statement that companies exceeding a threshold of mained steady at approx. 11 billion annually in 3 percent of wages increase (annually) would lose recent years). The latest restructuring programme their right to state support. Nevertheless, certain sets up subsidies of 9.6 billion PLN, of which 4.8 mines under the pressure of labour unions have billion PLN constitutes direct grants, to be paid found ways of fulfilling miners’ financial requests within the period 2004-2010. Subsidies are usu- without breaking the above-mentioned obligations ally earmarked for social purposes (severances for (e.g. premiums, trade vouchers). laid-off miners), for write-offs of financial com- The plan indicates that Polish mines are to “oper- mitments (e.g. environmental fees), and to coun- ate in an economically effective manner”, whereas teract the environmental problems caused by employment would be adjusted to the extraction closed mines. capabilities, and those in turn to the market situa- Nonetheless, reported state aid constitutes just a tion. Therefore, two scenarios of branch develop- share of subsidization existing in the sector. Coal ment are included into the plan: first, where due to quotas for foreign coal enable domestic mines to the high demand for domestic coal, the extraction expand their own extraction, as does the subsidi- would be limited only in the least effective mines sation of coal exports. Thanks to these export sub- (by 7.8 million tonnes with employment for 20 sidies, Polish mines were able to sell the energy thousand people); and second, presuming an end carrier on foreign markets at a price below the to favourable market conditions, the decline of cost of extraction. According to the evaluation of production by 14.5 million tonnes and employ- B.Fiedor and A.Graczyk (see Removing/ Restruc- ment of 25 thousand miners. turing Distortional Energy Subsidies in Poland, The intensity of the current discussion on the ef- www.env.cz/www/zamest.nsf/0/2c7b3bfbe711ffbfc125 fectiveness of the sector has supported the ques- 68f00026ae88?OpenDocument) the annual value of tioning of the rationality of earmarking consider- export subsidies to hard coal was at 350-450 mil-

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able public funds into the mining sector for the harmful in addition if they benefit producers of first time for years. However, environmental con- energy based on fossil fuels (in Poland, more than siderations are still underestimated. 97 percent of electricity has been produced from thermal plants since the beginning of the 1990s). Energy The long-term contracts served as a security for One of the main areas of concern in the energy loans taken by the energy companies. Loans of to- sector nowadays are long-term contracts. In the tal 17 billion PLN have been earmarked not only period of 1994-2001, the Polish Power Grid Com- for expanding production capacity or social pur- pany (PSE – a monopolist on the energy distribu- poses, but for modernisation and restructuring tion market and a stock company wholly owned programmes, including environmentally friendly by the State Treasury) underwrote an agreement investment projects (pollution abatement, com- (long-term contracts – KDT) with energy compa- bustion efficiency, waste management) as well. nies on energy sales at high, fixed (non-market) These financial efforts have brought certain posi- prices. Price regulations, which guarantee that tive results for the environment, which is reflected producers receive extra revenue, are a clear exam- in the table below. ple of subsidisation, and are environmentally Table 3. Emissions from power generating plants (in thousand tones). 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 SO 2 1310 1290 1270 1223 1195 1107 1034 915 805 769 NO 2 370 380 380 377 360 310 264 247 237 242 particulates 420 345 260 193 157 117 94 72 64 58

Currently about 40 percent of energy sold on the secondary significance for the power plants domestic market remains under KDTs. However, should be emphasised. Due to excessive capacity the European Commission has ruled that the con- of the electricity sector, most investments have tracts as inconsistent with the EU state aid regula- been directed for fulfilling even more stringent tions, recommending their removal. The first pro- emission standards. There have been subsidies, posal of state compensation for the energy pro- however, for energy consumers within the lump ducers for the renouncement of contracts has been sum system for gas and heat. The system gener- also questioned by the EC. Based on EC recom- ates cross-subsidisation between thrifty consumers mendations, the Energy Regulatory Authority of financing households with higher consumption of Poland proposed payment of compensation in two gas and heat. The scale of cross-subsidisation has stages: base payment of 10.6 billion PLN and been steadily decreasing because of the introduc- then, depending from the situation on the market, tion of an individual measuring system. payments of up to 14.2 billion PLN. For more information on ecotax reforms in Po- Analysing the other supply-oriented energy sub- land: http://www.ine-isd.org.pl/en/publi.htm sidy policies (soft loans, state guarantees), their

4. GREEN BUDGET REFORM WORLDWIDE

the economy is less vulnerable to oil shocks than Oil Fantasies before. This is because new industries (software, [Berivan Pont, Green Budget Germany, theme parks) need less energy than the old (steel, 18/11/2004] The recent surge in oil prices (around chemicals). And last but not least, Americans still 50$ per barrel) has taught us some useful lessons. can’t get themselves to think realistically about First, surprises may happen. Less than a year ago, oil; cheap oil is considered a birthright, and noth- specialists predicted today’s price at 25$. Second, ing in America is done to revisit this assumption.

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When oil gets expensive, we tend to blame oils A recent study from the consulting company PFC companies or OPEC. But the reality is more Energy discovered the world already uses 12 bil- complex. For energy economist Philip Verleger lion more barrels a year than it finds. This has Jr., massive miscalculation is the cause of present been going on for 20 years, but it can’t go on in- day prices. Oil companies and OPEC have simply definitely. PFC´s Mike Rodgers says future disco- underestimated global demand, in particular in re- very and recovery rates could be better or worse lation to China. Since 2001, China’s oil demand than assumed. He reckons global oil supply will has gone up by 36 percent. Moreover, unexpected peak around 2020 at about 100 million barrels a supply interruptions, such as sabotage in Iraq or day. Others argue oil has already peaked. But civil war in Nigeria naturally entail higher prices. whatever prediction turns out to be the right one, The future of oil prices remains undetermined. the world will rely more heavily on the Persian Verleger thinks prices can fly higher still, up to Gulf and former Soviet Union in the coming $60 or $80. But analyst Adam Sieminski of Deut- years. sche Bank believes prices may go down to $30 by Even though future is uncertain, America must 2005. But these uncertainties should not prevent take steps towards reducing its vulnerability to us from acknowledging two simple facts: first, global prices surges. One good thing to do is to world oil production cannot rise forever. Second, curb gasoline use, which represents about 45 per- we will rely more and more heavily on oil produc- cent of America’s oil demand. This could be done tion in the Middle East and other unstable regions. by promoting fuel-efficient vehicles, such as the Although this is the reality we must live with, “hybrids”, which combine gasoline and electric neither Bush nor Kerry have taken it into account power. But these vehicles cost $3000 to $4000 in their energy plans. Kerry plans to make Ameri- more than conventional cars, says David Greene ca independent from Middle East oil by develo- of the Oak Ridge National Laboratory. This cost ping renewable energy sources, such as solar or gap could shrink as production expands. Producti- wind energy. But Kerry forgets America imports on expansion could be achieved by adopting a ga- 60 percent of its oil, a fifth of which comes from soline tax of $1 to $2 a gallon. This way, Ameri- the Persian Gulf. Unfortunately, the global eco- cans would understand that gasoline prices would nomy remains largely dependent on Persian Gulf stay high and they would thus economize. But oil – and America depends on the global econo- such a tax is not popular, which explains why my. It seems Kerry misses the point: solar and hybrid car are not in Bush´s or Kerry´s plans. wind produce electricity (and heat in the case of Both prefer talking about hydrogen-powered cars. solar). In contrast, cars do not covert oil into e- But such cars will probably not be marketed for lectricity. In other words, cars run on oil, not e- years, given the technical obstacles to their pro- lectricity. Thus, in lieu of a major shift to electric duction. As says Robert J. Samuelson from the cars, solar and wind cannot replace oil as cars are Washington Post, “This captures our choice: ta- the most common consumers of oil. And the king modestly unpleasant preventive steps, or dream of using solar or wind energy to make running greater future risks by clinging to our fan- hydrogen via electrolysis will probably never co- tasies. History favours our fantasies.” me true: the conversion losses are so great (75 LINK: http://www.washingtonpost.com/ac2/wp- percent from "water to wheel") that the installed dyn/A10004-2004Oct5? capacity would have to be increased fourfold! With its vast reserves of oil, OPEC has a Bush believes America can disentangle itself from promising future oil dependency by producing what it needs itself. But even drilling in the Arctic National Wildlife [Jad Mouawad, New York Times for Süddeutsche Refuge would meet a mere 5 percent of America’s Zeitung, 11/10/04] The signs of OPEC´s supposed demand. America reached its oil output peak in decline into irrelevance are everywhere. Its share 1970 and has been in decline ever since. of world output, once 50 percent, is down to about one third. It was caught unprepared by a huge in- Neither want to acknowledge the real problem: crease in demand this year. Nearly all its members America´s oil consumption is too high - what are ignoring their production quotas and pumping must change first are mentalities. Then realistic all the oil they can. OPEC is lagging behind non- solutions will come by themselves. OPEC oil producers in exploration and oilfield

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development. And it has seemed helpless in con- Naimi described it recently as an “onslaught” trolling prices that soared to record highs. against Aramco and other states´ monopolies. “Oil But all that may not be important. OPEC still has companies are in a very difficult position”, said control of the world energy market, and Ali al- Ann-Louise Hittle, the head of macro oil research Naimi, the oil minister of Saudi Arabia and the at Wood Mackenzie, and Edinburgh-based con- principal figure in the cartel, intends to keep it. sultant. “The best they can do is to push into non- The key is oil reserves. OPEC has plenty, while OPEC countries and be poised for when OPEC the rest of the world is quickly pumping itself dry. invites them in. It’s apparent there’s a logjam to access now reserves.” This explains Western Far from waning, then, OPEC´s hold on the oil companies´ push to invest in Russia, despite market, and thus on the world economy, looks set President Vladimir Putin’s moves to return control to grow sharply in the coming decades. As alter- of the energy sector to the government. So the oil native sources of oil dwindle, so, too, will the industry must inevitably turn to OPEC, according United States´ room to manoeuvre in dealing with to Robert Ebel, the head of the energy program at OPEC, and especially with the five states around the Center for Strategic and International Studies. the Persian Gulf that are richest in reserves: Saudi “Access to reserves, that’s the name of the game, Arabia, Kuwait, the Unites Arab Emirates, Iraq “, M. Ebel said. “ You want to go where the re- and Iran. The United States will find it increas- serves are. So you go to Russia, for example, but ingly more difficult and complex to either engage you always come back to the Persian Gulf, be- or disengage in the Middle East in pursuit of en- cause that’s where the reserves are.” ergy independence or political stability or the war on terrorism, because oil from the gulf will be- Certainly, not all OPEC members keep out foreign come increasingly more indispensable to the investors; some, like Nigeria and Algeria, actively American economy, barring a wholesale change seek them. Even Saudi Arabia has tentatively in the way the nation uses energy. opened one door, granting Royal Dutch/Shell and the French company Total permission to prospect Those five gulf countries possess 61 percent of the for natural gas. But so far, Saudi oil is still out of world’s proven oil reserves, according to the latest bounds, and the energy giants say there aren’t statistics compiled by BP. Add the other six many other good places left to look. “The time for members of OPEC and the cartel controls three- large and easy discoveries is clearly behind us, “ quarters of the world’s 1.15 trillion barrels of re- said Thierry Desmarest, the chairman and chief serves. As the rest of the world has increased oil executive of Total. “By far the largest share of production to meet soaring demand this year, it undeveloped reserves remain under state control, has been exhausting reserves much faster than and in large part open only to national oil compa- OPEC has. At present rates of production, the nies. The opening of these reserves is urgent.” crude oil that has already been found outside OPEC will be consumed by 2030 or so, when the five gulf countries will still have billions of bar- Global Warming: Britain and Germany rels. Multinational companies are already worried. chart the way forward “As the absolute amount of energy provided by [Press Release, British Embassy Berlin, 4/11/04] OPEC countries has grown, as well as OPEC´s Britain and Germany are to take forward the fight share of the total, voices of concern over security against global warming under a bold new partner- of supply have increased”, said Lee R. Raymond, ship backed by leading industrial businessmen and the chief executive of ExxonMobil. “It will be dif- scientists. ficult to calm these concerns.” The oil companies The two countries, whose greenhouse gas reduc- want desperately to regain access to the gulf’s re- tions are among the biggest in the world, are well serves, but they have been locked out for decades. placed to spearhead new initiatives in areas such Many OPEC countries have state oil monopolies, as environmentally-friendly energy, climate most notably Aramco in Saudi Arabia, which the friendly financial markets, greener cities and Arc- country nationalized in 1980, and the five reserve- tic science. In an unprecedented show of leader- rich gulf nations all sharply restrict foreign in- ship between the two nations, a range of innova- vestment and influence over their oil industries. tive recommendations are to be presented to Tony The Persian Gulf nations are under mounting Blair, the British Prime Minister, aimed at deliver- pressure to let the Western oil giants back in; Mr. ing a low carbon, less energy intensive world.

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The importance of the conference, coming just Tickell, the former British ambassador to the days after the Russian parliament's decision to rat- United Nations and a key participant in the con- ify the Kyoto Protocol, was further underlined by ference, said: "It is clear that the costs of defeating being opened in the British Embassy by Her Maj- climate change are far less than some critics have esty Queen Elisabeth II during her State Visit to claimed and that the cost of inaction is likely to be Germany. Speakers included Margaret Beckett, far higher. There is no silver bullet for this issue, the UK Secretary of State for Environment, Food but the conference has delivered some innovative and Rural Affairs, Jürgen Tritten, the German and thought provoking ideas that can inform our Federal Minister for Environment, Nature Protec- next, crucial steps forward beyond the Kyoto Pro- tion and Nuclear Safety and Edelgard Bulmahn, tocol and into the middle of the new century". German Federal Minister for Education and Re- "The importance of leadership, providing the search. The recommendations will inform both the framework and stability needed for business and G8 and European Union presidencies which the industry to make sound, climate friendly invest- United Kingdom assumes next year. Mr Blair, ment decisions was a key outcome of our talks," who addressed the conference via a video mes- he added. sage, has stated that climate change, along with Aviation Fuel Africa, is the UK's top priority. Sir David King, Among the key findings and recommendations UK Chief Scientific Advisor, said: "his historic was a call for an end to the "anomaly" surround- conference has been made possible through the ing fuel for ships and planes. The conference ad- close cooperation between British scientists and vised Mr Blair that an emissions trading scheme German researchers. I must congratulate John or a carbon tax for aircraft and ships might bring Schellnhuber, Research Director at the Tyndall these two transport sectors in line with road, rail Centre and Director of the Potsdam Institute for and other forms of transport. Climate Impact Research, on his vital role in set- ting up this conference". He added: "2004 has Window of Opportunity been an extraordinary year. We have had some of Some 16 trillion US dollars worth of investment the worst weather-related natural disasters on re- in new power plants and energy systems are likely cord, and we have also had the positive outcome to be made in the coming years. It is vital that this of the Kyoto Protocol with the Russians ratifying. substantial sum is directed to more energy effi- This conference takes these issues forward and cient forms of generation including cleaner coal, forges a new agenda for climate action that will combined heat and power plants and renewables help lead us to a more stable and secure future in such as wind, wave and solar power. The dele- both the developed and developing world". Klaus gates agreed that Britain and Germany should Toepfer, the Executive Director of the United Na- work to exploit this current 'window of opportu- tions Environment Programme (UNEP) and chair nity" to lead a cost effective fight against climate of the conference Climate Change: Meeting the change. Germany and Britain, with a strong tradi- Challenge Together, said today: "We have had an tion in research, development and deployment of astounding meeting of minds between some of the new energy technologies, are well placed leading scientific, financial and industrial experts Climate-Friendly Finance of both countries. Support has come from the The conference recognized that the investment highest level with the Queen opening the confer- decisions of the finance sector could play a vital ence and Mr Blair requesting concrete outcomes role in putting the planet on a more climate upon which the UK government can act". "There friendly path but that "city institutions were not is now no question that human-made climate yet fully on board". Germany and Britain, both change is a reality and that leadership is urgently with key financial centres such as the City of needed to take the fight against its devastating im- London and Frankfurt, could play a pivotal role in pacts forward. This leadership is now here under bringing European and global pension funds, ac- the two industrialised countries whose emission tuaries and insurers on board. The two countries, reductions are so far amongst the highest and whose greenhouse gas reductions are scheduled to deepest in the world. I sincerely believe this An- be below those agreed under the Kyoto Protocol, glo-German partnership is the trigger needed to are well placed to champion new and deeper cuts put Europe and the world onto a more stable, less in industrialised nations' emissions. carbon dependent, path," he said. Sir Crispin

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Targets and Green Cities duce green house gas emissions will legally bind The UK's proposal of a 60 percent reduction by all industrial countries who have ratified the pro- 2050 and Germany's of a 40 percent reduction in tocol to do the same. Here is something new for emissions by 2020, are in line with scientific con- the international climate debate, after years of sensus on what is needed, delegates are advising stagnation. Mr Blair. The adoption of the Kyoto protocol will have London and Berlin will also share experiences and positive effects not only on the environment but plans to fight global warming which may become also on the economy. Increases in temperature and blue prints for cities and local authorities else- green house gas emissions have caused economi- where. The German capital has reduced its green- cal damage - global damage due to extreme house gas emissions by 15 percent since 1990 and weather conditions cost 55 billion US dollars in plans to cut back by a further 40 percent. London, 2002 alone. A few days before the Duma ratifica- which has a new Climate Change Agency, plans tion, the German Institute for Economic Research to reduce by 20 percent its emissions by 2010. in Berlin (DIW) showed in its weekly report 42/04 Under the agreement, the two capitals will share that a 1°C increase in global temperature could expertise and hold high level meetings on issues cause yearly damage to amount to 2000 billion US ranging from transport to energy efficient build- dollars in 2050, 137 billion of which in Germany ings in order to both meet their respective targets. alone. In a 50-year period, economical damage could amount to 214 trillion US dollars. Scientific Research No region will be spared the economical cost of Delegates also recommended strengthening and climate change; the frequency and violence of broadening the two countries' world-beating sci- natural catastrophes will increase in every part of entific ties in areas such as climate change impact the world. Besides the direct economic effects on in the Arctic. Under a new agreement German and the energy, agriculture and industry sectors, the British scientists are likely to share research ves- underlying simulation model takes into account sels and high-latitude, long range, aircraft. Scien- climate change effects on nature (for example for- tific studies into how to manage densely popu- est fires increases) and health aspects (sicknesses, lated areas in a warming world, with London and death rates, etc). Berlin as the first subjects, are also being consid- ered. Climate policy measures, such as emissions trad- ing schemes, can decisively lower costs by de- Awareness Campaigns creasing green house gas emissions. For an online Europe-wide awareness campaigns are also part of version of the DIW report “die ökonomischen the recommendations. Delegates called for witty Kosten des Klimawandels” by Claudia Kemfert, and thought provoking advertisements similar to visit those already launched in parts of Scandinavia to http://www.diw.de/deutsch/produkte/publikationen/wo raise public interest and action in combating chenberichte/docs/04-42-1.html. global warming. Further information about the conference is avail- Russia considers setting up EU-style able on our website: www.britischebotschaft.de/statevisit Emissions Trading Scheme [Lisbeth Kirk, EU Observer, 04/11/04] Less than German Economics Research Institute two months before the official kick-off of the EU emissions trading scheme, the market is already reports on the cost of climate change. heating up. Financial Times Deutschland reports [Translated by Berivan Pont, Green Budget Ger- that trading in emissions quotas has gone up five many, KlimaKompakt Spezial Nr. 27, 27/10/04] fold in recent weeks - from 150,000 tonnes traded Russia’s Federal Council approved the Kyoto Pro- per week in August to the current 750,000 tonnes tocol on 27 October 2004 after the positive vote in a week. the Duma on 22 October 2004. The protocol will The EU scheme will be the first multi-national take effect 90 days after the transmission to the emissions trading scheme in the world and will UNO of the ratification document, which Russian cover all 25 member states. The new rules aim at President Putin still has to sign. His pledge to re- creating an EU market in greenhouse gas emis-

GREENBUDGETNEWS NO. 10 PAGE 17 OF 25

sions to protect the environment. Companies that greenhouse gases will be required in the years exceed their CO2 quotas may buy emissions per- ahead. mits from companies not meeting their targets, or President Bush has refused to ratify the treaty pay a fine for each tonne they emit above their claiming it would harm the US economy. The US targets. Russia to set up domestic scheme The is the world's biggest polluter – despite having idea is spreading rapidly throughout the world, around only four percent of the global population, with Russia now considering setting up a domes- it is responsible for around 25 percent of the tic emissions trading scheme that could link to the world's carbon dioxide emissions. EU scheme, and a potential scheme in Canada, Working with corporate contributors to his cam- from 2008. "Russia cannot integrate as a full paign, President Bush is expected to try once member of the EU system because it is not a again to pass at home an energy bill that favours member of the EU, but our system could be de- coal, oil and nuclear power over cleaner sources veloped so it is complementary", said Vsevolod such as solar and wind power. The bill might al- Gavrilov, the Economic Development and Trade low for drilling in the Arctic National Wildlife Ministry official charged with drawing up Russia's Refuge. mechanisms for implementing Kyoto, according to Reuters. Russia should be able to earn billions Friends of the Earth International's vice-chair, of dollars from trading its spare quotas, he said. In Tony Juniper, said: Canada and Switzerland, concrete plans for emis- "Despite the best efforts of the USA and some of sions trading systems are being worked on, while its major corporations, the Kyoto Protocol lives. in Japan the process has not come as far, accord- This is an historic moment for life on Earth and ing to Point Carbon, a company analysing the must pave the way for new agreements to reduce greenhouse gas market. Japanese companies climate changing emissions. But intense interna- strongly oppose the idea of an emissions trading tional pressure must also be placed on President scheme, as it would mean mandatory caps on their Bush and the United States to finally acknowledge greenhouse gas emissions. 12,000 businesses in- the scale of the threat we now face and to take ac- cluded in the European system for emissions trad- tion to deal with it." ing will be launched in 2005, covering two peri- "The USA is the world's biggest polluter and has a ods (2005-2008 and 2008-2012). It will include moral responsibility to reduce the pollution that is some 12,000 European businesses in the energy rapidly warming up the world. If it does not, its sector (combustion, refineries, coke furnaces) and own economy and society will pay a heavy price," industry (ferrous metals, paper and minerals), he added. which account for more than 46 percent of all European carbon dioxide emissions. Australian Government unswayed by Russia´s Kyoto lead Russia ratifies climate change treaty; it [Berivan Pont,Green Budget Germany, 19/11/04] will enter into force on 16 February 2005 The Russian vote to sign the Kyoto protocol on 22 [Friends of the Earth, press release, 05/11/04] US October 2004 did not make the Australian gov- President George Bush became further isolated on ernment change its position, as it does not see why the issue of global climate change today following it should ratify the protocol, since (the govern- Russian ratification of the climate change treaty ment claims) it already does a lot to reduce GHG known as the 'Kyoto protocol'. Under the treaty emissions. Moreover, Environment Minister Ian industrialised nations responsible for 55 percent of Campbell says the protocol does not do enough to greenhouse gas emissions must ratify the protocol reduce emissions: even with Russia ratifying, it before it can come into effect. Now that Russia will only achieve a 1 percent reduction, and Aus- has ratified the treaty this key threshold has been tralia will not accept the protocol until it reduces reached. emissions by 60 percent. Instead, Australia seeks The treaty should now become legally binding to engage the major emitters in a comprehensive within 90 days of Russia notifying the United Na- agreement. Campbell says Australia should be tions. proud of what it has already achieved in reducing The Kyoto protocol is only the first step towards greenhouse gases. tackling climate change. Much bigger cuts in

GREENBUDGETNEWS NO. 10 PAGE 18 OF 25

Environmental group Greenpeace believes that percent for the United States, according to UN es- Australia is in fact lagging behind other countries timates. China, along with India and other devel- in reducing emissions, and criticizes it for lacking oping countries, argue that the developed coun- leadership on policy approaches to greenhouse gas tries should take the lead as they generate more reduction. greenhouse gas per capita. With a population of The United States also has no intention of signing 1.3 billion people, China's per capita emission rate the protocol even though the European Union is much lower than that of the United States, called on them to follow Russia’s lead. The Proto- Europe or other developed countries, but it is ex- col was negotiated under Clinton’s administration, pected to catch up as its GDP per capita increases. but President Bush turned away from it in 2001 China is experiencing nearly double-digit annual because of the supposed cost to the US industry. economic growth. Its goal is to quadruple its gross domestic product (GDP) by 2020. As the country Ratification met with considerable criticism industrializes, its energy consumption - and pollu- within Russia. Opponents fear the protocol might tion levels - are expected to soar. The developing damage Russia’s tottering economy still further. nations have so far resisted calls for restrictions on But Putin seems to have won support by negotiat- their emissions on the grounds that they would ing with the European Union Russia’s entry into hamper growth. the World Trade Organisation. For Yuri Safonov, environmental economist at Moscow's Higher As Gao Guangsheng, deputy director-general of School of Economics, Putin has used the Protocol the National Development and Reform Commis- as a bargaining chip to win international support sion, put it: "China doesn't want its emission vol- for his country's economy. ume to be higher than the United States, but you have to look at our population size. You must look Links: at how much per person. The priority is to satisfy http://www.abc.net.au/news/newsitems/200410/s1 our basic demand. The economy must develop. 226418.htm China has 1.3 billion people and we have to live. http://www.abc.net.au/news/newsitems/200410/s1 "The scope for reducing China’s carbon intensity 226304.htm is huge. China still relies on coal for about 75 per- cent of its energy and renewable sources account China faces pressure ahead of post 2012 for less then one percent. Greenpeace believes talks China can make better use of renewable energy [Point Carbon, 12/11/04] China's share of green- sources such as small hydroelectric plants; bio- house gas emissions is expected to exceed the mass and wind power. But instead of moving to- world's biggest polluter, the United States, by wards those energy sources, China is building around 2020 and pressure is mounting for Beijing hundreds more polluting coal-fired power plants to do more to limit global warming. Next year, the and has plans to build nuclear power plants, ac- international community is expected to launch cording to Lo Sze Ping, campaign director for talks on a regime to combat climate change for the Greenpeace in China. period starting in 2013, when Kyoto expires. Until "Many people want to invest in wind farms, but now only OECD countries and those with econo- they can't get loans," Lo said, blaming the prob- mies in transition from Communism face caps on lem on "bureaucratic inertia. Government officials their greenhouse gas emissions up to 2012. Pres- are not confident in new technology, unwilling to sure is building for the developing world to com- change policies."To reduce greenhouse gas emis- mit to capping their emissions as their contribu- sions, China must also increase energy efficiency, tion to global climate change grows. said Dan Millison, an environment and energy "China is the second biggest energy consumer in specialist at the Asian Development Bank's Ma- the world, accounting for 10 percent of global nila office. "China uses at least three times as consumption ... China's active participation in much energy per unit of GDP than OECD (the combating climate change is of crucial impor- Organisation for Economic Cooperation and tance," said Khalid Malik, the United Nations Development) countries," Millison said. "As of resident coordinator in Beijing, Channel News 2000-2001, China's economy was eight times Asia reported. China's emissions now account for more energy intensive than Japan and three times 13 percent of the global total, compared with 26 more energy intensive than the US; also three to

GREENBUDGETNEWS NO. 10 PAGE 19 OF 25

four times more than Malaysia, Indonesia, Thai- supporting the new tax bill. Business circles and land, and South Korea." the Ministry of Economy, Trade and Industry op- pose the bill. However, there is an important sen- Japan: Environment tax may be headed tence concerning what the revenue from the envi- toward pension fund ronmental tax will be used for in an internal document of the MOE. It says, "A part of the [Japan Today, 22/,11/04] The government's new revenue from the environmental tax will be used tax for environmental protection, the so-called to create more employment opportunities, main- "environmental tax," will be put into effect as of taining and enhancing strength of business corpo- January, 2006. The government is claiming offici- rations such as reduction of premium payment of ally that the new tax is to provide funding for business corporations. This implies a relation be- measures aimed at preventing global warming. tween the environmental tax and the National However, a confidential document of the Ministry Pension. The internal MOE documents detail the of Environment (MOE) indicates that the new tax system of the new environmental tax. According revenue will be used to make up the shortfall in to the documents, the environmental tax is to be the National Pension fund. Without knowing this, imposed on all chemical fuels such as oil, coal and the major Japanese news outlets are reporting in natural gas. Oil refinery companies pay tax on favor of the new tax. The Ministry of Environ- gasoline, light oil and propane gas, which will ment (MOE) announced a new tax bill for envi- force them to raise prices of those products. Con- ronmental protection on 5 November 2005. sumers also have to pay an environmental tax added to their utility bills. The MOE claimed that global warming was caus- ing more abnormal weather, which would bring Families will have to pay 3,000 yen a year about more damage to the people of the world. In total, one family will have to pay a 3,000 yen The advanced countries singed the Kyoto Protocol environmental tax a year, which will create 490 which limited the emission of green house gases billion yen in tax revenue for the government. The (GHG) which included carbon dioxide. In line MOE documents say that 340 billion yen of that with the Kyoto Protocol, the Japanese government will be used for implementing policies for reduc- promised to decrease the GHG by 6% in 2008 to ing the GHG and 150 billion yen will be allocated 2012 than the level of 1990. In reality, this means for maintaining and enhancing the strength of a 13% reduction since the level of 1990 increased business corporations, which means to reduce the significantly today. The MOE will increase the tax burden of business corporations to pay premium on oil products such as gasoline and home oil in for social insurance. One source on the LDP Envi- order to decrease the GHG. From January 2006, ronmental Committee told Shukan Post: "Business the Japanese people will have to pay a higher tax circles will never accept the plan for introducing on gasoline, light oil, home oil, electricity and gas. an environmental tax. The statement for reducing The major newspapers are supporting the new tax. their premium payment for social insurance is a The Asahi said in its editorial, "The Kyoto Proto- tactic to get businesses to accept the new tax. In col will be put into effect soon, which will accele- reality, however, the government gives tax relief rate the debate on the issue of environmental ta- to business corporations and the 150 billion yen is xes. Many European countries already have envi- used for helping the nation's ailing social security ronmental taxes but the Japanese government has system. The government promised to increase the been delaying the debate. The government has to government's share of payments for the National consider more seriously the introduction of an en- Pension, however, due to a shortage of resources, vironmental tax." The Mainichi stated in its edito- the government's plan now looks impossible. To rial, "The government has to limit GHG emis- solve the problem, the government is discussing sions. To accomplish this, the introduction of an an increase in the income tax as well as the con- environmental tax is extremely important. Many sumption tax. Now, the environmental tax is be- Japanese corporations are opposing the introduc- coming a part of them to cover the shortage in the tion of the environmental tax but they should be National Pension fund. Yoshio Tamura, director positive about it." The ruling Liberal Democratic of Environmental Bureau of the MOE, is leading Party (LDP), the New Komeito and even the op- the movement for an environmental tax. Tamura position Democratic Party of Japan (DPJ) are is from the Ministry of Finance (MOF). On 12

GREENBUDGETNEWS NO. 10 PAGE 20 OF 25

November 2004, a meeting of the Tax System Re- The sociologists Fritz Reusswig and Julia search Committee was held attended by the MOF Schwarzkopf from the Potsdam Institute for Cli- Tax Bureau Director and other tax executives. At mate Impact Research (PIK) and Philipp Pohlenz a news conference, Hiromitsu Ishi, the Tax Sys- from Potsdam University carried out the socio- tem Research Committee chairman, dwelt upon logical impact study on the film; the study was the idea of using a part of the environmental tax supported by the European Climate Forum (ECF) revenue for ailing social security. For soliciting an and the German Federal Ministry for the Envi- agreement, the MOE invited the chairman of the ronment, Nature Conservation and Nuclear Safety LDP Environmental Issue Research Committee (BMU). and eight committee members and one New Ko- The results show that, thanks to the accompanying meito member to Norway, the Netherlands and publicity, interviews and media reports, the film Germany for five days from 13 September 2004. triggered a small boom on the climate issue and Using the German system as model reached people who otherwise were not or not very interested in the subject. The film also man- Such lobbying is unusual. Those three European aged to impart a greater awareness of the com- countries already introduced an environmental tax plexity and vulnerability of the global climate to system in the 1990s and the Japanese government cinema-goers. The role played by the oceans, for is going to use the German system as its model instance, was not known to most of those inter- since the German government is using a portion of viewed before the film. The special effects ac- the environmental tax revenue to pay for social companying the descent into a climate catastrophe security. However, businesses have not changed by no means led to feelings of fatalism or escap- their opposition to the environmental tax. Tetsuji ism, as might have been expected. On the con- Kitta, director of Environmental Technology of trary, less than ten percent of interviewees went the Japan Federation of Economic Organizations home with the message "There's nothing we can said, "The level of energy effectiveness of Japane- do anyway", while 82 percent after watching the se corporations is one of the highest in the world. film preferred the slogan "We have to stop climate If an environmental tax is introduced, Japanese change". Most people also thought that it is still corporations will be encouraged to move their i- possible and economically feasible to pursue a neffective production plants overseas, which will policy of climate protection. German climate pol- make the global warming problem worse. Also, icy, which was not especially popular before the the government has not explained the 150 billion film particularly because of the "eco-tax", was af- yen use for social security. We have no idea how terwards significantly more accepted - not surpris- the money will be used for business corporations." ing, in view of the film's critical attitude towards the climate policy of the US government. Inter- Climate change à la Hollywood: Study on viewees thought Germany should increase its ef- forts, both at home and on the international level. the impact of the film Together with PIK, four other research teams "The Day After Tomorrow" from the US, the United Kingdom and Japan were [The Potsdam Institute for Climate Impact Re- involved in assessing the impact of the film on the search (PIK), 29/10/04] At the end of May 2004 public. These teams met on the 21st and 22nd of the climate thriller "The Day after Tomorrow" by October at PIK to exchange results. It became the Hollywood star director Roland Emmerich ap- clear that the different cultural and political back- peared in the cinemas in around 80 countries. grounds in these countries caused one and the Would this film re-kindle the climate debate and same film to have a very different impact on cin- promote protection of the climate? Or would it ema-goers. In the US, for instance, where climate damage the climate issue with its depiction of a and climate protection play a much smaller role in new, man-made ice age in the northern hemi- the public arena than in Europe, the film clearly sphere being based more upon fiction than sci- contributed to sensitizing the public to the issue ence? Scientists from the Potsdam Institute for and to the need for a policy on climate. Also, Climate Impact Research investigated the impact those who saw the film were much more inclined of the film. The latest PIK Report publishes the to vote for John Kerry than for George W. Bush. results of this study. The results of the study are published as PIK Re-

GREENBUDGETNEWS NO. 10 PAGE 21 OF 25

port number 92. The study can be accessed on the internet: http://www.pik-potsdam.de/publications/pik_reports/reports/pr.92/pr92.pdf

5. EVENTS

3.4.12.2004 Berlin Conference on 17.04.2005: Green Budget Germany An- "Greening of Policies - Interlinkages and nual General Meeting Policy Integration" Green Budget Germany’s Annual General Meet- The preliminary conference programme can be ing has been scheduled for 17 April 2005, imme- downloaded at: www.environmental-policy.de diately following our conference on 15–16 April. It will take place in the Schweisfurth Stiftung in 31.01 – 02.01. 2005, “Ecological Fiscal Munich. Reform and Conservation” More details will be published in the next issue of GBN. This three-day conference, organised in coopera- tion with the Academy of Conservation on Vilm Island, examines possibilities for synergy effects 14-17.06.2005, Lisbon, ESEE 2005 - the between EFR and conservation policy and to ana- 6th International Conference of the lyse ecological fiscal policies and conservation European Society for Ecological Eco- abroad, in order to establish what lessons Ger- nomics many can learn from other countries. To register ESEE 2005 will provide a forum for scientific de- for the conference contact Ms. Martina Finger: bate and discussion on theoretical and practical is- [email protected] sues in the field of ecological economics, focusing on the links between science, society and policy. 15-16.04. 2005: “Ecotaxes: Where The general theme of ESEE 2005 will be Science next?” and Governance - The Ecological Economics Per- GBG Conference in cooperation with the spective. The forum is open to all those interested in sustainability issues, independently of their af- Political Academy Tutzing filiation with the ecological economics scientific The conference, “Ecotaxes: Where Next? Eco- community. logical Finance Reform and Emissions Trading” Additional information is available from the Con- will take place on 15 and 16 April at the Political ference website: http://www.esee2005.org Academy Tutzing, near Munich. It aims to ana- lyse the current status of ecological taxes and emissions trading, focusing on Germany, Austria, September 2005, “Sixth Annual Global Italy and Switzerland, and to examine future pros- Conference on Environmental Taxation” pects for ecological steering policies in the con- The sixth annual global conference on Environ- text of the European Union and the German eco- mental Taxation will take place in Leuven, Bel- logical tax reform. gium in 2005. More information will be published More information on the conference will be avail- nearer the time in Green Budget News. able in the next edition of GBN.

6. LINKS AND PUBLICATIONS

GREENBUDGETNEWS NO. 10 – 11/2004

Spanish Conference on emission trading However, Kyoto is only the first step towards ef- rights and other flexible mechanisms fective international climate protection. The fur- This Conference was held in Barcelona on the ther development of the climate regime is now of 13/10/04. Many interesting presentations, includ- utmost priority. The Wuppertal Institute has dealt ing one from GBN Board Member Anselm Gör- with this issue in the project "South-North Dia- res, can be found in English on the following link: logue - Equity in the Greenhouse". Together with twelve researchers from all world regions a pro- www.http://mediambient.gencat.net/cat/el_medi/C posal on the design of a future international _climatic/ponencies.jsp?ComponentID=45811&S agreement was elaborated. Further information is ourcePageID=30697#1 available at http://www.wupperinst.org/Sites/Projects/rg2/108 Recently released UNEP publications on 5.html fisheries subsidies "Analyzing Resource Impact of Fisheries Subsi- Reducing emissions dies: A Matrix Approach" and "Incorporating Re- The Climate Group has put together a series of source Impact into Fisheries Subsidies Disci- case studies highlighting the range of positive ac- plines: Issues and Options". The aim of these pub- tions being taken to reduce emissions. These in- lications is to improve the understanding of the re- clude innovative policies, technologies and finan- source impact of different types of fisheries subsi- cial mechanisms being undertaken by leading dies, and to provide an analytical basis for the re- governmental and corporate actors to minimize form of environmentally harmful subsidies. A their carbon footprints. The case studies may be brief description can be found at: found on the following link: http://www.unep.ch/etu/publications/FisheriesSub http://www.theclimategroup.org/index.php?pid=3 Leaflet.pdf 73 The two publications are also available on the UNEP website: Proceedings of the 2002 Berlin Confer- http://www.unep.ch/etu/etp/index.htm ence on the Human Dimensions of Global Environmental Change Russian State Duma says “yes” to the Kyoto The Proceedings of the 2002 Berlin Conference on the Human Dimensions of Global Environ- The Wuppertal Institute welcomes the adoption of mental Change "Knowledge for the Sustainability the ratification law for the Kyoto Protocol by the Transition. The Challenge for Social Science" are Russian Parliament. With this decision of the now available online. The Proceedings comprise a Duma the main obstacle for the entry into force of peer-reviewed selection of the 30 best papers pre- the protocol has been overcome. Together with sented at the 2002 Berlin Conference, which was the Framework Convention on Climate Change held 6-7 December 2002 and attended by 220 par- the Kyoto Protocol now builds a functioning in- ticipants from 29 countries. The conference was ternational regime for global climate protection. endorsed by two IHDP core projects, Institutional Kyoto parties should now intensify their imple- Dimensions of Global Environmental Change mentation efforts to comply with the international (IDGEC) and Industrial Transformation (IT). The climate commitments. The Wuppertal Institute complete table of contents and all individual con- contributes to these efforts by developing con- tributions are now available at cepts for innovative climate protection policy - http://www.glogov.org/front_content.php?idcat=9 like an energy efficiency funds - and supports the 2 German government in the implementation of the instruments introduced by the Kyoto-Protocol. http://www.wupperinst.org/Sites/Projects/rg2/107 8.html

GREENBUDGETNEWS NO. 10 PAGE 23 OF 25

New energy link on the Earth Track web- pioneering and thought-provoking articles con- site tributed by the world’s leading environmental tax scholars representing various jurisdictions world- As part of Earth Track's continued commitment to wide. Its insight and analysis will benefit those improved access to information on energy subsi- looking to achieve environmental goals through dies, a detailed energy subsidy links page has tax policy. Full detail can be found online at: been created on the website: http://www.richmondlawtax.com/environmentalta http://www.earthtrack.net/. x.html

New content and searchable database on Fiscallygreen.ca Energy Taxes in the Nordic Countries - Does the polluter pay? The one-stop shop for information on "fiscal poli- cies for environmental objectives" in Canada and National Statistical Offices in Norway, Sweden, internationally, http://www.fiscallygreen.ca/. This Finland & Denmark. Final report March 2003 website now includes a searchable database of The Nordic countries have some of the highest ecologically oriented policies around the world. rates of environmental taxes as a percentage of the Users can search the database for particular types total taxes and as a percentage of GDP2. Earlier of policies, policies in a particular region, or poli- there has been a focus on energy taxes as a whole, cies geared towards a specific environmental is- the relationship between total energy taxes and sue. GDP and energy taxes and total taxes. This pro- ject, on the other hand, focuses on energy taxes Newsletter "JIKO Info" now available in broken down by industries in the Nordic countries and addresses in particular the connection be- English tween who uses the energy and who pays the JIKO Info, a newsletter on the Kyoto mechanisms taxes. Industry-specific taxes combined with in- CDM & JI, is now available in an English version. formation on energy use, air emissions and value JIKO Info informs about current development of added give unique possibilities to analyse whether the policy field "project-based mechanisms in there is a match between who pollutes and who Germany and Europe". The newsletter is pub- pays the energy taxes. Or in other words: Does the lished by the Wuppertal Institute for Climate, En- polluter pay? vironment, Energy as part of the project "JIKO - LINK: development phase 2002-2004". http://www.scb.se/statistik/MI/MI1202/2004A01/ MI1202_2004A01_BR_MIFT0404.pdf If you want to subscribe to JIKO Info in English, please go to 2 job openings at the Environmental and http://www.wupperinst.org/sites/projects/rg2/jiko- Energy Study Institute info Full time Policy Assistant/Analyst. More informa- tion on: Critical Issues in Environmental Taxa- http://www.eesi.org/employment/Admin%20Asst tion: International and Comparative Per- %2010.04%20posting.htm spectives, Volume 1 Full-time Program Administrative Assistant. More Richmond Law &Tax recently published the pro- information on: ceedings of the Third Annual Global Conference http://www.eesi.org/employment/Policy%20Asso on Environmental Taxation. The book contains ciate%2010.04%20posting.htm

GREENBUDGETNEWS NO. 10 PAGE 24 OF 25

7. READERS’ GUIDE AND IMPRINT

Readers’ Guide: Reading our Newsletter is not difficult. Just follow the instructions below: • First, you should make certain that you always have sufficient free memory in your E-Mail Account. If you don’t have enough free memory in your E-Mail Account, you won’t receive the mailing. Our Newsletters will have up to 425 Kilobytes per copy. • Do not try to print the HTML-Version in your Mail-Account, because it won’t work! For a printable version click on the link at the top http://www.eco-tax.info/downloads/GBN10.pdf Then you can download a printable PDF-Version of the Newsletter. • You can read all our newsletters in our archive on this page: http://www.eco-tax.info/2newsmit/index.html In the Newsletter Archive you can access individual topics by clicking on them in the directory. You don't to view the whole document. Enjoy reading your copy of the GreenBudgetNews

Green Budget Germany’s Team of Editors

You can contact the Green Budget News editors at the following addresses:

Förderverein Ökologische Steuerreform European Environmental Bureau Green Budget Germany Boulevard de Waterloo 34, Landsbergerstr. 191 – D – 80687 München B-1000 Brussels Tel.: +49 89 520 113- 13 Fax: - 14 Tel: +32 2 2891090 [email protected] Fax: +32 2 2891099 www.foes.de [email protected] www.eco-tax.info www.eeb.org

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ÖGUT – Österreichische Gesellschaft The Ecological Council für Umwelt und Technik Blegdamsvej 4B Austrian Society for Environment and Technology DK - 2200 Copenhagen N Hollandstraße 10/46 Phone: +45 33 15 09 77 A – 1020 Vienna Fax: +45 33 15 09 71 Tel.: +43 1 315 63 93 – 13 Fax: - 22 [email protected] [email protected] www.ecocouncil.dk www.oegut.at

GREENBUDGETNEWS NO. 10 PAGE 25 OF 25

Final corrections were made by: Craig Morris, Translation Director at Petite Planète Energy, Technology, Policy, Finances - Translations for a Small Planet [email protected], http://www.petiteplanete.org Tel. & Fax: +49-761-881-4801 Rehlingstrasse 6c, 79100 Freiburg, Germany