In 2007, the European Union (EU) adopted its integrated approach to climate and energy policy. By 2020, the region aims to reduce greenhouse gas emissions by at least 20 percent below 1990 levels, to generate 20 percent of its energy from renewable sources, and to improve energy efficiency by 20 percent. While the EU is on track to meet or exceed its goals in the first two categories, it is set to miss its energy efficiency target and is poised to reduce its energy consumption by only 9 percent.
Maybe they should try more double paned windows
Under current EU rules, energy efficiency is the only energy and climate target that is not legally binding. Despite the forecasted shortfall, two weeks ago Europe’s heads of state shied away from taking decisive action on energy efficiency and announced a review of the region’s energy savings plan in 2013 at the earliest. European leaders said they did not want to place additional constraints on their economic policy during a period of economic crisis.
What explains the difference in success rates among the EU targets? Critics contend that the lack of enforceability is to blame for the region’s shortcomings in energy efficiency. A closer look at the EU’s effort to reduce greenhouse gas emissions, however, reveals that binding targets alone may not be sufficient to reach energy-efficiency goals.
A financial levy similar to that proposed in the Investing in Our Future Act, called the Robin Hood Tax, is gaining support in the United Kingdom.
It’s been called The Robin Hood Tax, the Tobin Tax, and the less sexy Financial Transactions Tax or Currency Transaction Levy. According to Congressman Pete Stark (D-CA13), who introduced a bill on July 20 to create a version of it in the United States, the proper name is the even less thrilling Investing in Our Future Act of 2010 (which is at least better than calling it by its bill number, House Resolution 5783). But what is it, and what does it have to do with climate change?
Whatever the name, the concept is relatively straightforward: deduct a very small percentage (Stark’s bill suggests 0.005 percent, or five-thousandths of one percent) from the transfer of large amounts of money between people and/or companies, especially the exchange of one currency into another. The rationales for this charge are many. While the fee makes the value of a single transfer of money almost unnoticeably less (just 5 pennies off for a tourist converting 1,000 U.S. dollars to Euros), it makes the shuttling of money thousands of times between different bank accounts or currencies much costlier. That kind of back-and-forth trading happens routinely in currency speculations that, according to many commentators, contributed decisively to the recent financial crisis. Most versions of the charge would exempt small amounts of money ($10,000 each year per company or per person in the Stark bill), keeping the burden off vacationers and small-time traders while discouraging risky repetitive maneuvers by banks and hedge funds.
Just how much money could this fee raise, and where would the funds go?
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