DECOUPLING OF GHG-EMISSIONS FROM GROWTH HOW IMPORTANT ARE THE CO 2 TAXES? A CASE STUDY OF SWEDEN
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1 DECOUPLING OF GHG-EMISSIONS FROM GROWTH HOW IMPORTANT ARE THE CO 2 TAXES? A CASE STUDY OF SWEDEN Elisa Abascal Reyes, 1 Reino Abrahamsson, 2 Sara Almqvist 2 and Per Wollin 2 1 Swedish Environmental Protection Agency, Environmental economics unit 2 Swedish Environmental Protection Agency, Air and climate policy unit Naturvårdsverket Swedish Environmental Protection Agency
2 The most frequently asked question? Does it work? Yes it does. Kind of. Substantial reduction of total GHG-emissions with no obvious negative welfare effect. How does it work? Well Naturvårdsverket Swedish Environmental Protection Agency
3 Our aim: To explore different data sources in order to be able to identify important questions for further analysis To identify questions for further analysis; necessary in order to improve policy making Optimal tax level from a: Total welfare point of view? GHG-emission reduction point of view? Exemptions? Other instruments? A practitioners point of view! Naturvårdsverket Swedish Environmental Protection Agency
4 Good to know 9 SEK = 1 EUR Sector approach follows the IPCC reporting classification. Naturvårdsverket Swedish Environmental Protection Agency
5 We start with a narrative The energy- and CO2-tax is an effective instrument to reduce GHG-emissions. Thanks to this effective instrument, substantial GHGemission reductions have been made without harming economic growth. Considering the relatively strong economic growth of Sweden it could be the case that energy- and CO2- taxes imply benefits of action! Not the quickfix for everything Naturvårdsverket Swedish Environmental Protection Agency
6 National emissions of GHG in Sweden , million tonnes Military, diffuse emissions and use of dissolvents Waste treatment Combustion in service, households, agriculture, forestry and fishery Combustion in industry 50 Industrial processes 40 Agriculture Energy industry Other domestic transports Road transports, freight Road transports, passengers Naturvårdsverket Swedish Environmental Protection Agency
7 Total energy supply (TWh) in Sweden by energy source Wind power Nuclear power, gross Hydo power, gross Heat pumps in district heating plats Biofuels, waste, peat Coal and coke Natural gas, town gas Crude oil, oil products Naturvårdsverket Swedish Environmental Protection Agency
8 Some remarks Except from the residential sector, total emissions have decreased mostly in the least taxed sectors. Other instruments, and political goals, have been in place during a long period. In the most taxed sectors, total emissions have decreased only moderately or even increased. Naturvårdsverket Swedish Environmental Protection Agency
9 Fiscal revenues from energy- and CO2- tax , million SEK Energy tax, total CO2-tax, total Total Naturvårdsverket Swedish Environmental Protection Agency
10 Energy- and CO 2- tax share of gasoline-, diesel- and fuel-oil price (excl. VAT) to consumer ,0% 50,0% 40,0% 30,0% Diesel Gasoline Fuel-oil 20,0% 10,0% 0,0% Naturvårdsverket Swedish Environmental Protection Agency
11 Index CPI, Price Gasoline 95 oct SEK/l., Diesel SEK/l, Average nominal disposable income (2000=100) Gasoline 95 oct. SEK/litre Diesel SEK/L Average nominal disposable income CPI Naturvårdsverket Swedish Environmental Protection Agency
12 Passenger kilometres per capita and mean of transport , , , , , ,0 Road transport Public transport (road) Railway and subway Walking, bikes, motorcycles 2.000,0 0,0 Naturvårdsverket Swedish Environmental Protection Agency
13 Tonne kilometres per capita and mean of transport , , , , , , ,0 Road transport Railway Shipping 1.500, ,0 500,0 0,0 Naturvårdsverket Swedish Environmental Protection Agency
14 Emissions of CO2-equivalents per litre fuel in total transport sector ,5 2 1,5 1 Kg CO2-eqv. emissions per l fuel in transport sector (passenger and freight) 0, Naturvårdsverket Swedish Environmental Protection Agency
15 Emission of CO 2 -equivalents per passenger kilometre and tonne kilometre ,140 0,120 0,100 0,080 0,060 Kg CO2 eqv per person kilometre, vehicles for personal transports Kg CO2 eqv per transport kilometre road transports 0,040 0,020 0, Naturvårdsverket Swedish Environmental Protection Agency
16 Questions for further analysis A matter of efficiency or effectiveness? Taxes as a driver for structural changes of the economy? Instruments and infrastructure in place? National vs. global markets? Other political goals? Naturvårdsverket Swedish Environmental Protection Agency
17 Thank you Naturvårdsverket Swedish Environmental Protection Agency
18 Energy price for the residential- and service in Sweden öre(cent)/kwh Electricity price, domestic use Electricity price, detached house with electric heating Oil price, fuel oil Price district heating, apartment buildings 0 Natural gas, price Naturvårdsverket Swedish Environmental Protection Agency
19 1993Q1 1993Q4 1994Q3 1995Q2 1996Q1 1996Q4 1997Q3 1998Q2 1999Q1 1999Q4 2000Q3 2001Q2 2002Q1 2002Q4 2003Q3 2004Q2 2005Q1 2005Q4 2006Q3 2007Q2 2008Q1 2008Q4 2009Q3 2010Q2 2011Q1 2011Q4 2012Q3 2013Q2 GDP market prices in Sweden, fixed prices (2013), quarterly data* GDP market price Naturvårdsverket Swedish Environmental Protection Agency
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