November 9, 2018 / 1:55 PM / a year ago

German Finance Ministry rejects idea of new CO2 pricing system

BERLIN (Reuters) - Germany’s Finance Ministry has rejected Environment Minister Svenja Schulze’s idea for a new pricing system for carbon dioxide emissions to help protect the climate, a Finance Ministry spokesman said on Friday.

“The introduction of a new CO2 pricing system is not being considered at all,” a spokesman for the ministry told a news conference.

Schulze raised the prospect of a levy on fossil fuels like petrol, gas or heating oil on Wednesday and said she would work on a concept for CO2 pricing with the finance ministry.

She said the price of electricity would be reduced so citizens do not end up worse off.

There is considerable resistance among Chancellor Angela Merkel’s conservatives to such a levy, which would make gas heating or filling up cars with petrol or diesel more expensive.

Germany’s oil industry association also rejected such a change to CO2 pricing, saying it would merely be a tax increase in disguise.

“For most of Germany’s population, that would mean that it would become more expensive to drive cars and heat their homes,” the association’s head Christian Kuechen said in a statement.

The association said current fuel tax rates were equivalent to drivers of gasoline or diesel fueled cars paying around 275 euros each per tonne of CO2.

“Electric cars also cause CO2 emissions in Germany’s power mix, but pay only around 60 euros per tonne,” Kuechen said.

Reporting by Markus Wacket and Maria Sheahan; Writing by Michelle Martin; Editing by Jan Harvey

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