Monday, March 10, 2008

Select Committee says Climate Change Levy has not worked

The Climate Change Levy is a uch lauded piolicy by the Government if I recall correctly. A tax on businesses to be more environmentally friendly and reduce their carbon emmissions. A roaring success to according to the Government.

Yet, according to a report published by the Environmental Audit Select Committee it has not actually worked in the way the Government would like. The report summary says
The CCL has not worked quite as expected. According to economic theory, businesses should have acted rationally by seeking to reduce their costs through increased energy efficiency. In practice, they appear to have needed an extra stimulus to change their approach to energy use. This has profound implications for climate change policy more widely. If even large companies require additional policies to drive behavioural change, this must be all the more true for small businesses, public bodies, and private households.
In other words, the politics of pain (tax) over the politics of pleasure (incentives) ihas been shown to be wanting yet again.


Chris Paul said...

Pain and pleasure both are encapsulated in this. Just not enough pain and pleasure it seems.

The pain is more tax, the pleasure is less tax. The incentive is the ability to reduce own tax while doing good and shoring up CSR.

Needs to be hardened up?

Alex said...

The whole climate change levy system with its complicated system of exemptions was doomed to fail. Instead of encouraging renewables and reducing CO2 companies simply did whatever they could to reduce financial costs. For example instead of generating electricity from gas (which is not green but it is efficient and hence produces less CO2 than coal) the new system encouraged electricity companies to bring coal fired power stations back into use and power them with a mix of coal and wood chips, which actually increased overall CO2 emissions.

The whole system is overblown with the dead hand of civil servants stifling the productive economy. In Germany and Spain they have a much simpler system (probably less financially interventionist) and it works fantastically well. The Germans have more wind power than we have from all forms of renewable energy (including historic hydro) and more solar power than we have wind power.

Tim Worstall said...

The problem is that the Committee doesn't understand the economics of the taxation.
Pigou taxes are not there to create a certain level or not of pollution. They are to make sure that the polluter pays the social cost of their pollution.

Glyn H said...

May I draw your attention to part of the Manhatten Declaration, only last week part, of which reads:
Affirming that global climate has always changed and always will, independent of the actions of humans, and that carbon dioxide (CO2) is not a pollutant but rather a necessity for all life;

So its all bollocks; as John Redwood said 'They've not found the Range Rovers on Mars yet' (although it has the same climate change symptoms)

Why is it our government cleaves to anything which will damage us such as the EU, Identity cards, the disaster of our public education, this climate change panic but cannot run our services, defence, immigration polies to our advantage?

Anonymous said...

Its all a con dizzy ,the sun is getting hotter,a natural cycle.
Venus ,mars ,jupiter,Saturn are all in global warming at the moment.Al Gore's graph is flawed,the hockey stick rise is a different data set (planet surface temp)the begining of the graph is dendrology (tree ring growth) which has no link to global temps.
Its all a tax con.If you put the sun temp rise into the graph it cancels out the rise.(oh dear)


Anonymous said...

Global COOLING this past year wiped out 100 years of global warming.stats nasa and others,link
to data sets :
The TAX is based on FRAUD ,
Global CO2 tax is a front for global anything including GOVT,a bilderburg plan no less,Al Gore went there once I believe.
agent phyzx