EC Plans Energy Tax to Curb Emissions : Environment: Ministers see it as way to cut down on carbon dioxide threat to Earth’s temperature. They also hope to nudge the U.S. into action.


European environmental and energy ministers on Friday approved in principle an energy tax designed to cut down on carbon dioxide emissions that threaten to increase the Earth’s temperature, raise ocean levels and flood coastal areas around the globe.

Dutch Environment Minister J. G. M. Alders, chairman of Friday’s meeting of representatives of the 12 European Community nations, said he hopes Europe’s effort will make the Bush Administration think twice about its opposition to tough measures to curb carbon dioxide emissions in the United States.

“This will keep the momentum going and put pressure on the United States to come up with a meaningful response,” said Rafe Pomerance of the World Resources Institute in Washington, who was in Brussels to monitor the EC’s action.

The EC had already pledged to reduce carbon dioxide emissions in the year 2000 and beyond to the 1990 level. It estimates that emissions would increase by about 10% during the decade in the absence of government programs to restrain them.


At their meeting Friday, the ministers declared that programs adopted individually by the 12 EC nations would probably not do the job of stabilizing emissions of carbon dioxide, which is a major byproduct of the burning of fossil fuels such as coal, oil and natural gas.

So the ministers asked the EC Commission, in effect the bureaucracy of the European Community, to prepare proposals for “higher energy pricing through the use of fiscal instruments"--the EC’s euphemism for taxes.

The tax would be levied on all energy users, from small households to large industries, according to their use of carbon dioxide-generating fuels.

To minimize the economic drag of higher tax levels, the ministers said the new energy taxes should be offset by reductions in other kinds of taxes.


Nor did the ministers decide to rely strictly on the tax strategy. They also instructed the EC Commission to look at ways to increase energy efficiency and conservation and the use of solar power and other energy sources that do not produce carbon dioxide.

The ministers set May of next year as their goal for choosing a specific set of carbon dioxide-reducing policies. That is one month before a U.N. conference in Rio de Janeiro to examine worldwide solutions to global warming and other environmental problems.

Alders, the Dutch environmental minister, admitted that the EC, which generates only 13% of the carbon dioxide produced by energy consumption, could not reverse global warming by itself. He said he hopes that the United States, which produces about twice as much carbon dioxide per capita as Western Europe, will join the campaign, although he admitted that recent talks between U.S. and European officials had produced no movement. “In any case, we’re not going to wait for them,” Alders said.

Some EC environmental and energy ministers, notably from Spain, reportedly expressed reluctance at Friday’s meeting to accept any tax that might interfere with their economic development.


Alders initially proposed a declaration that an energy tax “will be needed,” sources said, but the final language held only that such a tax “is likely to be needed.”

The EC Commission had put global warming on the environmental and energy ministers’ agenda in September by proposing a tax on petroleum users of $10 a barrel, or nearly 25 cents a gallon.

Other fossil fuels, such as coal and natural gas, would be taxed by an equivalent amount--enough, the commission judged, to yield the necessary reduction in expected carbon dioxide emissions. A separate tax would be levied on energy sources that produced no carbon dioxide--principally nuclear power--so that electricity users in such heavily nuclear countries as France would also feel incentives to conserve power.

The commission estimated that its proposal would raise the average price of gasoline in Europe by 6% and of electricity by 14%.


Altogether, the taxes would raise up to $80 billion a year, although they would be offset by equivalent reductions of other taxes.