A European Union plan to extend carbon pricing to the fuel used in cars and to heat homes is facing a wall of early resistance from countries and lawmakers fearing a public pushback unless backers find ways to compensate those worst hit.
According to leaked drafts, the scheme would set up an Emissions Trading Scheme (ETS) for transport and heating, creating a market price for carbon – a price that fuel suppliers are likely to pass on to Europe’s half a billion consumers in the form of higher bills.Some even raise the prospect of it triggering “yellow vest” movements like the often violent protests that spread across France from late 2018 after an attempt to raise fuel taxes.
“This is a big risk for the willingness among the population to go forward with the transition,” one EU official said, of the EU’s goal to move towards a climate-neutral economy.
“We have to tread very carefully.”If they go ahead with it next week, European Commission policy-drafters promise to add social protections, including by channeling some revenues from the new ETS into a social fund to support the needy.But critics question whether risking a political backlash is wise for something they say will only indirectly influence consumers’ behaviour – especially when the EU is already planning tougher car CO2 standards and energy-saving requirements for buildings to curb emissions in those sectors.
“Taking such a political risk for a limited gain, I think it’s not worth it,” Pascal Canfin, a member of French President Emmanuel Macron’s La Republique En Marche! movement and chair of the European Parliament’s environment committee, told Reuters.
Canfin, who created a stir in June by declaring the plan “political suicide”, described it as a de facto regressive tax and cited analysis by the Commission itself suggesting an ETS for road transport would cut emissions by barely 3%.
Any plan proposed by the Commission must be negotiated and eventually approved by the European Parliament and member states.