Paris Withdraws Carbon Tax Plan Because It Failed

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French governments have been struggling with tax emissions to coal. Back in 2009, Francois Fillon abandoned the idea when his plans weren’t agreed to by the Constitutional Council. The biggest union of energy workers and miners have sunk the plan.

On the 25th of April, Francois Hollande, the president of France, had said that the introduction of minimum quota prices for greenhouse gas emissions. He said that this was going to give greater visibility to investors while promoting gas over coal in the electricity sector.

After aggressive lobbying, the measure had been restricted to the four remaining power stations that are coal-fired. A couple in Cordemais and Le Havre are run by the EDF while the other two in Saint-Avold and Gardanne are run by Uniper.

This tax was meant to be introduced as part of the 2017 budget of France. Gerard Mestrallet, the ex-boss at Engie, is a committee member working on carbon prices.

But this isn’t going to happen. Christian Eckert, Budget Secretary of State, recently removed this amendment for introducing carbon tax which was approved by the sustainable development committee of the French parliament.

The amendment had been rejected by the government when demonstrations were organized by the CGT. Demonstrators certainly had a few persuasive arguments for the MP near Saint-Avold’s power station.

After burying amendments, the secretary of state spoke about introducing this tax later on. He said that under the multi-annual energy program in France, the coal-fired power stations would be closed down latest by 2023.

The environment ministry was making different noises, arguing the coal tax would be enacted at the European level.

This failure of tax emissions is doubly problematic for the country. But, it will give a significant boost financially to Uniper and EDF which can run their power stations at maximum capacity while taking advantage of the high electricity prices.

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