Transport Government to postpone the most difficult decisions on traffic emission reductions until the autumn – decisions to increase the price of petrol in particular cause a twist

There have been differences of opinion between the governing parties as to what and at what pace decisions will be made. However, no means have yet been ruled out, ie politically difficult transport taxation, for example, can be reverted to in the autumn if other means do not cut emissions sufficiently.

Government has decided, in its negotiations on future emission reductions for transport, to postpone any tax and transport pricing decisions until the autumn.

Instead, the first decisions on subsidies and incentives could be taken as early as the spring framework debate in April.

There have been differences of opinion between the governing parties as to what and at what pace decisions will be made. However, no means have yet been ruled out, ie politically difficult transport taxation, for example, can be reverted to in the autumn if other means do not cut emissions sufficiently.

The government will also continue to investigate emissions trading in transport. At the request of the city center, the government will investigate the significance of the increase in telework for future emission reductions.

Similarly, a study will be carried out as to whether the fuel distribution obligation could be further increased from 30%, to which the obligation will rise in 2029. The distribution obligation determines how much of the fuel sold must be renewable.

Government the Ministerial Working Group on Climate and Energy Policy has been negotiating a fossil-free transport plan in recent weeks. This plan, or “roadmap,” as the government calls it, includes a number of ways to halve greenhouse gas emissions from domestic transport by 2030 and achieve zero emissions by 2045 at the latest.

The target is ambitious and calls for action specifically in road transport, which generates 94% of transport emissions. In their reports to the Ministry of Transport and Communications, researchers have stated that it is not possible to achieve the goals without changing the pricing of fossil fuels.

Much has already been done to reduce emissions from transport, but there is still 1.55 million tonnes of emissions left to be halved.

Road map will leave for a short round of opinions on Friday for evaluation by various parties.

In the negotiations, the Center has appealed that, according to the government’s program, the taxation of fossil fuels will be increased by EUR 250 million during the election period, in line with the projected increase in consumer prices. This increase has been made since the beginning of this year, and the center has previously lined up, it will not agree any more.

The center believes that it is also possible to achieve emission reductions without tax cuts.

The center invented the importance of teleworking as a source of emission reductions in the guidelines it presented in October. The party estimates that increasing them with lessons learned from the coronavirus would cover almost a third of the emission reductions still needed.

Other parties are more skeptical because the government cannot impose companies on telecommuting and there is still no certainty about how permanent changes in working life will result from the korona.

The government’s negotiations have been based on the Ministry of Transport and Communications presentation by the working group fossil fuel transport plan.

It mentions one possible means transport emissions trading, where the state would auction petrol and diesel distribution rights. The mechanism would likely lead to higher fuel prices.

Emissions trading in transport and heating has also been considered in the EU as a way to reduce emissions. There are no EU guidelines on the matter yet, and Finland will probably have to wait for them before making its own decisions.

Transport- and a working group from the Ministry of Communications proposed a number of measures that are politically easier than raising the fuel tax.

One means that has been found to be effective, namely the extension of the distribution obligation, is already progressing because a separate presentation has been made, on which opinions are currently being collected. If the proposal goes through, biogas and electric fuels can also be included in the distribution obligation.

The working group also proposed procurement support for the purchase of electric and gas-powered heavy equipment and other instruments to promote the sale of low-emission cars. It is already underway scrapping premium campaign.

The Working Party considers that the proliferation of electric cars should be promoted through various economic instruments, such as fixed-term purchases and changes in car and vehicle taxes. The working group also recommended increasing subsidies for public transport and wanted to promote alternative modes of transport to motoring.

For the opinion the outgoing roadmap does not address car and vehicle taxes, as they are being considered by a separate working group of the Ministry of Finance, which will report on its proposal in February.

The working group will also find out the Minister of Finance Matti Vanhanen (middle) presented by the model, where the taxation of fuels would be replaced by a tax based on mileage. The level of the tax would depend on the condition of the road network and the availability of public transport.

Correction 14 January at 6.20 pm: It was written earlier in the story that a study on emissions trading in transport would be made at the request of the Greens. The report was not the demand of the Greens alone, but was more widely supported by the government.

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