September 9, 2019 / 3:06 PM / 11 days ago

Finland to back increase in fossil fuel taxes

OSLO (Reuters) - Finland’s new government will propose a tax increase later this year on fossil fuel used for transport, as well as measures to help expand electric-vehicle-charging networks, the country’s environment ministry told Reuters on Monday.

The government, in office since June, wants to make Finland carbon-neutral by 2035. It emitted 8.48 tons of carbon dioxide per capita in 2017, according to the European Commission’s EDGAR, the emissions database for global atmospheric research. By comparison, Norway emitted 8.85 tons per capita and Sweden just 5.13 tons.

Finland has fallen behind both Norway and Sweden in adopting electric cars — at the end of 2018, Finland’s fleet of electric cars barely exceeded 2,400 units. In Norway, by contrast, more than 46,000 were sold last year alone, thanks to generous tax incentives

A ministers’ working group on climate and energy policy hopes to change that, said Riikka Yliluoma, a special adviser to Finland’s environment minister.

“Already this autumn the goal is to finalise acts on electric-car-charging stations, increase tax on fossil fuels in transportation,” she said in an emailed statement.

There are also plans to set new subsidies for energy- efficiency measures in residential buildings, she said.

The size of the fuel tax and of the electricity subsidy will be determined as part of Finland’s 2020 fiscal budget, said Outi Honkatukia, the country’s chief climate change negotiator.

The working group will also commission new studies to identify the best measures to reach carbon neutrality by 2035, Yliluoma said.

These will include studies on cutting emissions across all sectors and increasing the use of carbon capture and storage sinks for the country’s heavy industries such as forestry.

Industry accounts for more than half of Finland’s annual carbon emissions, followed by electricity production and transport, which are responsible for just over 10% each, according to OECD data.

Reporting by Lefteris Karagiannopoulos; editing by Terje Solsvik, Larry King

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