A Comprehensive Greenhouse Gas Mitigation Strategy for The Netherlands

By Nicoletta Batini, Simon Black, Oana Luca, Ian W.H. Parry

August 20, 2021

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Nicoletta Batini, Simon Black, Oana Luca, and Ian W.H. Parry A Comprehensive Greenhouse Gas Mitigation Strategy for The Netherlands, (USA: International Monetary Fund, 2021) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

The Netherlands has ambitious greenhouse gas emission reduction targets for the future - to cut them by 49 percent below 1990 levels by 2030 and 95 percent by 2050. These targets and the likely new EU-wide targets under the recent EU Green Deal entail a rapid acceleration in decarbonization. This paper discusses the government’s mitigation strategy and advances several recommendations to complement and reinforce that strategy and to achieve better alignement of the effective carbon prices across sectors. The paper discusses alternatives to make the recently-introduced industry carbon levy more effcient and recomends the use of revenue-neutral feebate schemes in industry, transportation, buildings, and agriculture. For power generation, it recommends eliminating taxes on residential and industrial electricity, supplementing the coal phaseout plan with an increase in the CO2 emissions floor price. The impacts of these reforms on consumption would be low and relatively evenly split across the income distribution.

Subject: Agricultural sector, Carbon tax, Economic sectors, Environment, Greenhouse gas emissions, Taxes

Keywords: Agricultural sector, Carbon tax, Climate mitigation, Emission rate, Global, Government's mitigation strategy, Greenhouse gas emissions, Natural gas, Reduction target

Publication Details

Pages:

40
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2021/223
Stock No:

WPIEA2021223
ISBN:

9781513593388
ISSN:

1018-5941

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