Carbon emissions ‘could be 20% lower’ if no fossil fuel subsidies


Carbon emissions could be at least 20 per cent lower by 2030 if the Government withdrew a range of fossil fuel subsidies, including those in the transport and peat production sectors, research from the Economic and Social Research Institute (ESRI) has found.

In its research, the think tank found that the removal of eight fossil fuel subsidies could have a “sizeable impact” on reducing emissions in the Irish economy while also having a modest adverse effect on growth and household income.

The impact of other environmental policies such as increasing the share of renewables in power generation and increasing energy efficiency in home retrofitting would come in addition to this.

The ESRI said that eight fossil fuel subsidies accounted for €2.44 billion in lost Government revenue in 2014. Those fell into three categories: transportation, electricity and peat production; excise tax rates on diesel fuel and kerosene; and means-test fuel allowances for households.

Some of those include subsidies on marked diesel used in agriculture, subsidies for electricity generation from peat, the exemption of certain jet fuel from excise duty for commercial aviation purposes and the diesel rebate scheme used by hauliers.



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