A price for carbon and emissions to fight climate change
The European Citizen Initiative
What is an European Citizen Initiative and how it works
This European Citizen Initiative was conceived in collaboration with international scientists, led by Professor Alberto Majocchi, and is supported by committed politicians. It is a participatory democracy instrument that allows citizens to suggest concrete legal changes in any field where the European Commission has power to propose legislation, such as the environment, agriculture, energy, transport or trade.
An initiative enables citizens from different member states to come together around an issue close to their heart with a view to influencing EU policy-making.
To launch an initiative, it takes 7 EU citizens, living in at least 7 different Member States who are old enough to vote. Once an initiative gathers 1 million signatures with minimum thresholds reached in at least 7 countries, the European Commission must decide whether or not to take action.
Currently this initiative is under the revision of the European Commission’s committee. Once approval will be granted, the campaign will officially start.
For info: Virginia Fiume - firstname.lastname@example.org - +32493158956
The text of the European Citizen Initiative on Carbon Pricing
A price for carbon to fight climate change
We ask the European Commission to propose a EU legislation to discourage the consumption of fossil fuels, encourage energy saving and the use of renewable sources for fighting global warming and limiting temperature increase to 1,5°C.
3. Main objectives
Our proposal introduces a minimum price on C02 emissions, starting from 50€ per CO2 tonne from 2020 up to 100€ by 2025.
At the same time, the proposal shall abolish the existing system of free allowances to EU polluters and introduce a border adjustment mechanism on non-EU imports, in such a way as to compensate for the lower pricing on CO2 emissions in the exporting country.
The higher revenue deriving from carbon pricing shall be allocated to European policies that support energy saving and the use of renewable sources, and to the reduction of taxation on lower incomes.
4. Legal Basis
Article 192 (1)(2) of the TFUE
Alberto Majocchi, Professor of Public Finance, Universitá degli Studi di Pavia, Italy
The Citizens’ Committee:
Marco Cappato, former MEP and founder of Science for Democracy - Italy
Monica Frassoni, President of the European Greens - Belgium
Spyros Psychas, Coordinator of Volunteers at ANIMA (Wildlife preservation society), Greece
Claudia Basta, Phd Researcher, The Netherlands
Ioana Ionel, Dr Centru Cercetare Universitatea POLITEHNICA, Romania
Mirko Hänel, Head of Research & Development at TTZ, Germany
Ana Luisa Fernando, Professor Auxiliar, Centro de Engenharia Mecânica e Sustentabilidade de Recursos, Portugal
Virginia Fiume, Science for Democracy Projects Coordinator - ECI and Coordinator of Eumans, Belgium
A carbon price to combat climate change and to increase employment
by decreasing taxes on labour
Explanation note to the European Citizen Initiative A price for carbon to fight climate change
For info: Virginia Fiume - email@example.com - +32493158956
The political crisis in France following the increase in fuel tax clearly shows that the two most important challenges facing the European Union are, on the one hand, to control climate change by reducing fossil fuels consumption and increasing the use of renewable energies, thereby initiating the ecological transition of the economy;, on the other hand, to reduce the tax burden on workers and businesses by reducing social security contributions - particularly for low-wage workers -, combating poverty and promoting employment through reductions in labour costs. The possible solution to these two challenges is to impose a carbon price(a carbon tax), which is compensated by the reduction on levies needed to finance incentives for renewable energies (with the carbon tax the incentive consists in the fact that traditional energies are burdened by the carbon price, from which renewables are exempt). Moreover, the revenue generated through carbon tax can be used to reduce levies on lower wages and the use of the labour, both to compensate for the regressive effects of an energy tax on the budgets of poorer households and to foster employment. This can thus lead to a double dividend: combating climate change and increasing employment.
Among the causes of climate change, which already have a heavy impact on the livelihoods of a large part of the world, a significant role - confirmed by scientists in the Intergovernmental Panel on Climate Change (IPCC) - must be attributed to CO2 emissions linked to the use of fossil fuels. In order to reduce these polluting emissions, it is necessary to use the instrument that regulates consumption trends on the market, i.e. goods selling prices. In this case, it is a question of increasing the price of fossil fuels so that their consumption is reduced and, consequently, CO2 emissions are reduced too.
As early as 1992, in the run-up to the Rio Conference on Sustainable Development, European Commission President Jacques Delors approved a proposal to introduce a $10 per barrel carbon/energy tax to curb carbon dioxide emissions, and then recycling this revenue into the economy through a reduction in social security contributions. The Directive was not approved then by the Council and subsequently, the European Union adopted the Emission Trading System (ETS), which requires about 11,000 energy-intensive companies (production of electricity, steel, aluminium, paper, ceramic glass, etc.) to purchase pollution permits corresponding to a gradually reduced volume of permitted emissions. The current price of these permits is currently around €20 per t CO2; the emissions thus subject to a constraint correspond to about 45% of the total.
Therefore, 55% of polluting emissions are not included in the system and do not pay a price to cover the damage caused to the environment. It is therefore essential - within the European Union - to set a price also for these sectors excluded from the ETS, which include transport, SMEs, the domestic sector and agriculture. The simplest method is to set an additional price on the use of fossil fuels that generate carbon dioxide emissions, imposing a carbon tax which is commensurate with the amount of carboncontained in each fuel (emissions being proportional to the amount of carbon). This way, all emissions, in the ETS sectors and in other sectors, would be burdened by a price for the use of energy sources that contain carbon.
The objective of this policy is to meet the commitments made in Paris in the climate agreement approved on 12 December 2015. But a unilateral decision taken within the European Union to impose a price on the use of fossil fuels requires that the same price be charged on goods produced using fossil fuels in countries outside the Union which do not impose similar measures on domestic production. And the instrument to be used is the imposition of a countervailing border duty, equal to the price charged for fossil fuels used in the European market. This measure has two advantages: on the one hand, it ensures that the competitiveness of European production is not penalised and, at the same time, it encourages other countries to adopt similar measures, given that the failure to impose a price on sources containing carbon does not produce competitive advantages, since they have to pay the countervailing duty at the European Union border.