Tuesday 11 October 2022

Petrol excise holidays and emissions

The stupid petrol excise holiday also resulted in the transport sector bidding more ETS credits away from other sectors. 

Daalder notes that it amounts to about two hundred thousand tonnes of extra transport emissions. Government auctions about 5 million tonnes of credits per quarter, and that volume won't change with the excise holiday. 

So all that's then happened is a shift in where ETS credits have wound up, or potentially a slight increase in tree-planting as compared to the counterfactual. It won't and can't have affected net national emissions. The binding cap binds.

The excise holiday was still really stupid. But any increase in transport emissions means a reduction in net emissions elsewhere. 


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