The bullet passed through the church last night after long negotiations. Residents of the European Union must pay for the greenhouse gases they emit. This means that you have to pay every time you top up and turn on the heating due to the contaminants released.
Anyone who has insulated their home well, bought a heat pump or switched to an electric car can receive support from a special fund. There will also be money for people who have less money to spend as a result of inflation. This fund has resources of over 86 billion Euros.
CO2 emissions must be reduced by more than half
The measures are part of a package of climate laws. By 2030, CO2 emissions need to be reduced by 55 percent. European industry, some of which already have to do this, will have to account for higher emissions costs, and companies from countries outside Europe will pay for their emissions at the border. The money raised can be spent on climate plans.
Citizens and companies have to pay for the CO2 that comes out of the exhaust and chimney. This can be done through energy companies and pumping stations. You have to pay the emission rights and then invoice the customer who comes to fill or burn the water heater.
Esther de Lange (CDA), Member of the European Parliament, said: “I am pleased that a balanced agreement has been reached on the largest ever package of climate legislation in the EU.” He was one of the negotiators responsible for the coordination of the Green Deal and the chief negotiator of the Social Climate Fund.
“With this agreement, we are drastically reducing emissions in Europe in a socially responsible manner and without harming European industry. The introduction of ETS for transport and buildings is essential to meet our climate targets. This cannot happen without social action that will benefit the people making this transition, as European businesses and households are already facing extremely high energy prices.”
In the last few days, three main climate plans that need to be coordinated have been discussed: CBAM, ETS and Social Climate Fund.
Heavy industry in Europe is only allowed to emit emissions for which it is CO2 certified. This is known as the emissions trading system ETS (see figure below). The EU determines annually how many of these so-called CO2 certificates can be distributed to industry. The amount of appropriations allocated decreases each year, reducing European emissions.
Companies are allowed to trade with these rights, hence the so-called emissions trading system. If a firm produces economically, that firm can sell other permits to polluting firms that need additional rights. Therefore, more economical companies are more profitable and there is a financial incentive to produce sustainably.
There was concern that this system would cause companies to leave Europe. Because companies in Europe have to pay for their emissions, their products are more expensive than companies outside Europe. Due to this unfair competition, companies could choose to leave Europe. Therefore, the sector got some of its rights for free and received subsidies. This partially neutralized the financial incentive to become more sustainable.
AB found a solution to this: CBAM (see image below). Companies polluting the environment outside of Europe are reluctantly willing to sell their goods in Europe, paying for their CO2 emissions at the border.
A few years ago Milieu Centraal calculated that the Dutch are responsible for three times as many CO2 emissions as the average global citizen.
Fossil fuels, oil and natural gas, are the biggest emitters of CO2 when burned, especially when burned to generate electricity.
According to the current situation, the plans will come into effect a year ago in 2027, which is the social climate fund. These are expected to be small quantities for citizens. Refueling is expected to average no more than 10 cents, according to a spokesperson. Plans were made for the energy crisis.
Source: NOS
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
