During the negotiations of the Kyoto Protocol, in 1997, two main ideas were discussed: The Europeans were pushing towards a tax, like the EFR, while the US were preferring a cheaper market instrument, the cap and trade system

The US won this battle, we now have an ETS system in Europe, but then they refused the sign the KP.

But the EFR is still a nice idea. The two market instruments are not exclusive, one could very well imagine an EFR for small consumers, and an ETS for big companies.

Tax the energy, not jobs

The idea is to operate a tax shift to polluting activities. It means essentially to tax fossil energy sources and reaffect the tax product in three ways:

• to compensate tax alleviation done in other sectors

• to be redistributed to the population (as it is proposed in Switzerland through a subvention of the mandatory health insurance)

What are the problems?

The intense debate surrounding tax products blocks the development of all political initiatives in this direction. Ecological tax reform is a gradual process, and needs to be worked through with all parties concerned.

Sweden, Estonia and Switzerland have already managed to introduce embryos of this kind of tax shift, but heavy compromises were necessary. At the European Union level, everything is frozen at the moment.

What is Noé21 doing?

In order to explain this principle, Noé21 has produced a 12 minute film, “CO₂: Tomorrow I quit », available on this website.

We demonstrate that this EFR can generate local employment and therefore foster a sustainable economical growth.

We are trying to overcome these problems by lobbying the European Parliament and industrial groups.

EFR the Basel and the German examples

The canton of Basel introduced a very good tax system: part of the taxes can be invested into renewable energy and efficiency.

In 1999 an Ecological Fiscal Reform was introduced in Germany. The tax was increasing regularly every year, and behavioral changes were indeed happening.

This new tax did allow noticeable reduction in CO₂ emissions. And created new jobs.

But taxes are unpopular: the new Merkel government stopped this ongoing process.

• Download the movie « CO₂ : Tomorrow I quit »
• Article of ZhongXiang and Andrea Baranzini: "What do we know about carbon taxes? An inquiry into their impacts on competitiveness and distribution of income"
• “EEA report 2006 on market instruments"
• “Carbon 2007 : A new climate for carbon trading”
• OECD report on CDM: “The developing CDM market”
• “Forest fraud: say no to fake carbon credits”
• More information on Carbon Taxes vs. Emissions Trading
• Climate justice now!