Minister: CO2 quota sales revenue one of electricity inflation measures
Finance Minister Keit Pentus-Rosimannus says a government relief package aimed at combating soaring energy costs in Estonia can be covered, at least in part, through surplus income from CO2 emission credits trading.
Pentus-Rosimannus had already said at the end of September that such a measure would take weeks to complete, mainly due to strict European Commission-level regulations, while in the intervening time electricity prices have continued to rise.
Natural gas prices and, for that matter fuel prices, have also been reaching record levels in Estonia.
The relief package would be geared specifically towards those living in financially-straitened circumstances, she added, though in addition to a quick, short-term solution, investments which will help keep energy consumption lower in the future should also be carried out via longer-term activities, she went on.
Pentus-Rosimannus said these would range: "From the proper insulation of buildings, through to the replacement of expensive and inefficient heating systems to renewable energy solutions. To do this, we can use first and foremost EU funding," BNS reports.
The government announced earlier on Wednesday that advanced negotiations deciding on electricity price rise measures were continuing, having failed to reach agreement between the two coalition parties, Reform and Center, on Tuesday evening.
Quota revenue may be used for achieving climate and energy policy objectives, including, for example, the development of energy efficiency and renewable energy, the promotion of low-emission mobility and public transport, and the mitigation of and adaptation to climate change, BNS reports.
Speaking at a government press conference accompanying the government's signing-off on the 2022 state budget at the end of September, Pentus-Rosimannus said that the government aims to develop a mechanism during the state budget procedure which would mitigate the impact of the sudden rise in energy prices on consumers, adding that it likely will be possible to use the higher-than-estimated proceeds from the emissions trading scheme for this purpose.
CO2 Emission trading schemes (ETS) for carbon dioxide such as that operated by the EU aim to limit climate change by creating carbon allowances marketplace.
Carbon allowances are issued by a government and typically allow an owner to emit one tonne of CO2, or sometimes another pollutant. They are heavily regulated under a government's, in this case the European Commission's, emissions cap-and-trade regulatory program.
Estonia does not make it into the top 20 of CO2-emitting nations in absolute terms, due mainly to its small population. China, at 28 percent total emissions according to some estimates, is by far the largest emitter, with the U.S. (15 percent) the only other sovereign nation with a value in double figures. Russia's figure is 5 percent, the U.K.'s one percent.
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Editor: Andrew Whyte