Taxing Energy Use 2015

Energy is a critical input into the production and consumption patterns that support economic and social wellbeing. However, many forms of energy use contribute to the environmental and climate challenges societies face today. Taxation is a key tool by which governments can influence energy use to contain its environmental impacts.

This report provides a systematic analysis of the structure and level of energy taxes in OECD and selected other countries; together, they cover 80% of global energy use. ‌This report builds on the 2013 edition of Taxing Energy Use, expanding the geographic coverage of the 2013 data set to include Argentina, Brazil, China, India, Indonesia, Russia and South Africa.

The Cost of Air Pollution: Health Impacts of Road Transport

Outdoor air pollution kills more than 3.5 million people a year globally, far more than was previously estimated. This book estimates the economic cost of the health impacts of air pollution from road transport – on a global scale, but with special reference to People’s Republic of China, India and the OECD member countries. It establishes this estimate by multiplying the “value of statistical life” (derived by aggregating individuals’ willingness to pay to secure a small reduction in the risk of premature death) by the number of deaths attributable to outdoor air pollution, as released by the World Health Organisation (WHO) in 2010.

The Swedish Tax on Nitrogen Oxide Emissions

Sweden was facing a serious soil acidification and water eutrophication problem caused partly by emissions of nitrogen oxides (NOx) from combustion processes in transport, industry and power. In 1992, Sweden introduced a high tax on NOx emissions from large combustion sources (e.g. power plants, industrial plants, waste incinerators). The tax was accompanied by a refund according to the amount of energy generated. This ensures that facilities with low NOx emission intensitites are net beneficiaries of the scheme. Continuous monitoring of emissions was also made mandatory. The tax was designed to accelerate and stimulate investment in advanced combustion and pollution-abatement technologies and as a supplement to existing regulatory measures. 

Effective Carbon Prices

Economic textbooks predict that taxes and emission trading systems are the cheapest way for societies to reduce emissions of CO2. This book shows that this is also the case in the real world. It estimates the costs to society of reducing CO2 emissions in 15 countries using a broad range of policy instruments in 5 of the sectors that generate most emissions: electricity generation, road transport, pulp & paper and cement, as well as households’ domestic energy use. It finds wide variations in the costs of abating each tonne of CO2 within and among countries, as well as in the sectors examined and across different types of policy instruments. Market-based approaches like taxes and trading systems consistently reduced CO2 at a lower cost than other instruments. Capital subsidies and feed-in tariffs were among the most expensive ways of reducing emissions.
 

Taxing Energy Use: A Graphical Analysis

Taxation is one of the most important government policies affecting energy use and therefore the environmental problems (such as greenhouse gas emissions and air pollution) to which various forms of energy use can give rise. This report provides the first systematic comparative analysis of the structure and level of energy taxes in all OECD countries. It presents effective tax rates on energy use in terms of both energy content and carbon emissions, together with detailed graphical profiles of both the structure of energy use and energy taxes in each country. It is a data-rich tool that will help policy makers and analysts to evaluate the role and impact of current energy tax settings and to plan potential reforms.

Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels 2013 

This Inventory provides quantitative estimates of direct budgetary support and tax expenditures supporting the production or consumption of fossil fuels in OECD member countries. For each of the OECD’s 34 member countries, it provides a succinct summary of its energy economy, and of the budgetary and tax-related measures provided at the central-government level (and, in the case of federal countries, for sub-national units of government) relating to fossil-fuel production or consumption. Many of the measures listed are relative preferences within a particular country’s tax system that cannot be readily compared across countries, hence no national totals are provided. The information has been compiled as an exercise in transparency, and to develop a better understanding of potentially environmentally harmful subsidies (EHS) and of support to fossil fuels in particular. It is also intended to support the ongoing efforts of G20, APEC and other nations to reform their fossil-fuel subsidies.

Mortality Risk Valuation in Environment, Health and Transport Policies

This publication presents a major meta-analysis of 'value of a statistical life' (VSL) estimates derived from surveys where people around the world have been asked about their willingness to pay for small reduction in mortality risks.

‌Taxation, Innovation and the Environment

Solving the world’s environmental problems could take a significant toll on economic growth if only today’s technologies are available. By putting a price on pollution, do environmentally related taxes spur innovation? What types of innovation result? Does the design of the tax play a critical role? What is the effect of this innovation? In analysing these questions, this publication draws on case studies that cover Japan, Korea, Spain, Sweden, Switzerland, the United Kingdom, Israel and others.

Valuation of Environment-Related Health Risks for Children

Is the value of reducing environmental risks greater for children than for adults? If so, what does this mean for policy makers? This report presents new findings on these key environmental policy questions.

Instrument Mixes for Environmental Policy

There are in many cases good arguments above for using several policy instruments in combination. Many environmental problems are of a “multi-aspect” nature – it can, for example, matter where emissions take place, when they occur, how a polluting product is applied, etc. Also, certain instruments can underpin each other. However, in some cases, the use of overlapping instruments reduce the economic efficiency of the mix, while in other cases, the lack of some instruments can cause problems. This book addresses these issues in detail.

Economic Valuation of Environmental Health Risks to Children

The relationship between the environment and children’s health has been the subject of increasing interest amongst policy makers. This book proposes an in-depth analysis of the main methodological difficulties associated with estimating the social value of a reduction in environmental risks to children.

Cost-Benefit Analysis and the Environment: Recent Developments 

Environmental protection is now an integral part of public policies, at local, national and global levels. In all instances, the cost and benefits of policies and projects must be carefully weighed using a common monetary measuring rod. Yet, many different categories of benefits and cost must be evaluated, such as health impacts, property damage, ecosystem losses and other welfare effects. How can we evaluate these elements and give them a monetary value? How should we take into account impacts on future generations and of irreversible losses? How to deal with equity and sustainability issues? This book presents an in-depth assessment recent conceptual and methodological developments in this area.

The political economy of environmentally related taxes

There is increasing evidence of the environmental effectiveness of environmentally related taxes. However, there remains a high potential for wider use of these policy instruments, provided that they are well designed and that their potential impact on international competitiveness and income distribution are properly addressed. Based on experience in OECD countries, this book provides a comprehensive discussion of these issues and of the environmental and economic impacts of applying environmentally related taxes, and looks at how to overcome obstacles to their implementation.

The Distributional Effects of Environmental Policy

Tradeable Permits: Policy Evaluation, Design and Reform

After many years of experimentation tradeable permits have become a key measure in the environmental policymakers’ toolbox.  This publication offers valuable lessons for applying tradeable permit systems, and evaluating their effectiveness and efficiency. It also reviews the more general links between policy evaluation and policy design, implementation and enforcement.

‌Ensuring Environmental Compliance: Trends and Good Practices

Despite progress in recent years, there is growing evidence that OECD countries are not on track to reach some of their key environmental goals. This report examines the strategies and instruments that governments use to ensure compliance with pollution prevention and control regulations.

In recent years, a significant number of OECD member countries have introduced initiatives to reduce the environmentally damaging effects of public procurement.  Many countries have introduced "greener public purchasing" (GPP) policies in order to increase the recycled content of products or achieve specified levels of energy efficiency in capital equipment.  This book examines these issues in detail.  It is the outcome of a Workshop on "Greener Public Purchasing", held at the Austrian Ministry of the Environment in Vienna in October 2001.

Economic Aspects of Extended Producer Responsibility

Extended Producer Responsibility (EPR), a policy approach in which the responsibility of the waste from a consumer good is extended back up to the producer of the good, is developing and expanding in OECD countries.  Governments find that these schemes can provide a new and flexible approach to reduce the upward trend of waste from consumer products. To address these issues, OECD organised a workshop in December 2002, which was hosted by the Japanese Ministry of Environment, in Tokyo. This book contains selected papers presented at this workshop.

Environmentally Harmful Subsidies: Policy Issues and Challenges

Proceedings of the OECD Workshop on Environmentally Harmful Subsidies held on 7-8 November 2002. For the first time, experts from a variety of backgrounds (government, academics, researchers and representatives of international organisations and civil society) had the opportunity to take stock of and share technical knowledge of subsidies and their environmental impacts. They addressed these issues in the context of such diverse areas as agriculture, fisheries, energy, industry, transport, forestry and water resources.

Voluntary Approaches for Environmental Policy: Effectiveness, Efficiency and Usage in Policy Mixes

Do voluntary approaches deliver the expected environmental benefits? Do they help reach environmental targets in a cost-effective way? This report provides an assessment of the use of voluntary approaches building on a number of new case studies.

‌Implementing Domestic Tradeable Permits: Recent Developments and Future Challenges

This publication presents the proceedings of an OECD workshop on domestic TPs held in September 2001 in Paris. It provides an analysis on recent developments in the use of domestic TP in new areas including climate change, renewable energy, transport, solid waste management, and water resources management. It highlights issues regarding the use of TPs in policy mixes, reviews key elements of ex post evaluations of earlier TP schemes, identifies key challenges in the design and use of TP systems, and attempts to link the past lessons to further research needs.

Domestic Transferable Permit Systems for Environmental Management: Design and Implementation

This publication provides a systematic analysis of the various approaches, challenges, conditions and potential solutions relating to the design and introduction of domestic transferable permit schemes.

Environmentally Related Taxes in OECD Countries: Issues and Strategies

This report analyses current use of environmentally related taxes in OECD Member countries. Focus is given to their environmental effectiveness. The report identifies obstacles to a broader use of such taxes -- in particular the fear of loss of sectoral competitiveness -- and ways to overcome such problems.

Extended Producer Responsibility: A Guidance Manual for Governments

This guidance manual represents one means to inform national governments about the potential benefits and costs associated with EPR.

Environmental Requirements for Industrial Permitting

Environmental permits have played a major role in improving industry's environmental performance across the last few decades. Because they adopt a precautionary approach during the setting of environmental requirements, permitting strategies have also favoured pollution prevention.

Voluntary Approaches for Environmental Policy: An Assessment

This book provides a systematic analysis of the different types of voluntary approaches, their economic characteristics, their role and effectiveness.

‌Improving the Environment Through Reducing Subsidies. Part 1: Summary and Policy Conclusions. Part 2: Analysis and Overview of Studies

The report develops an analytical framework which enables policy makers to identify those support measures whose removal is most likely to lead to "win-win" benefits.