Published 18:02 on January 2, 2019 at Carbon-pulse
The Netherlands faces a turbulent year in agreeing a plan to meet its 2030 domestic emission target after green groups withdrew their support because it failed to include a carbon tax for heavy industries while setting a lower carbon price floor for the power sector. The government published the 233-page sector-by-sector draft climate agreement on Dec. 21 after nine months of consultations, with over 100 entities detailing how the country can meet its target to cut emissions 49% under 1990 levels by 2030.
The plan covers all sectors of the economy and includes a scaled-down minimum carbon price for the power sector of €12.30 per tonne of CO2 in 2020, rising annually to €31.90 by 2030. The government had previously agreed to impose a floor starting at €18/tonne in 2020 rising by €2.50 annually to €43 in 2030 – a level that analysts had expected to have no impact until the second half of the decade as it would be lower than projected EU ETS prices.
The government has tasked its environment and economic agencies – PBL and CPB respectively – with assessing the draft over the next few months with particular reference to how the cuts and costs are divided among society. The government will consider the agency recommendations before putting a revised plan before parliament.
“The plan is likely to face further changes and is already dividing politicians, so we can expect considerable debate,” said Jos Cozijnsen, who has recently joined Dutch consultancy Climate Neutral Group after over 20 years as an independent climate policy expert.
Members of the centre-right VVD and CDA parties of the coalition government have urged caution over the plans, while MPs from the liberal D66 and conservative CU coalition partners are calling for more ambition. Several groups involved in the process withdrew their support ahead of the release of the draft. Trade union FNV said the impact on poor households would be too great, while six green groups, including Greenpeace and Natuur & Milieu, were angry that it didn’t include any additional carbon taxes on heavy industry beyond their EU ETS requirements.
“It is very simple: those who pollute the most, have to pay the most,” the green groups said in a joint statement, referring to companies in big-emitting sectors such as steel, chemicals, and oil refining.
As well as higher energy taxes for the biggest 350 emitters, the plan proposes to force these companies to come up with plans on how they intend to meet their share of the emission target by 2020 or face fines of €30/tonne for excess emissions in 2020, rising to €43/tonne by 2030. The government has asked PBL to study the effect of fines of up to €100/tonne in its assessment.
Other measures in the draft include:
- By 2021, all local authorities should have briefed home owners and landlords when each of their neighbourhoods will be cut off from their gas supply
- By 2030, some 1.5 million homes and buildings should be properly insulated and gas-free
- Loans for homeowners faced with large bills for insulation, with €100-150 mln a year made available to subsidise costs for all.
- The tax on natural gas will rise
- In 2021, people buying an electric car costing under €60,000 will be able to get a subsidy of €6,000. This will go down by €400 a year until it hits €2,200 in 2030
- The cost of buying a diesel or petrol car will go up from 2021, as will the tax on petrol and diesel
- No new petrol or diesel cars may be sold from 2030
- All coal-fired power stations will be shut by 2030 and wind and solar farms will be expanded
By Ben Garside