When it is about pushing climate policies, the debate often surrounds the costs of implementation. Nations debate with nations, while citizens debate with their leaders. Locally, proponents often stress that new policies will create new jobs, 'green jobs,' as they say in the US. What is often not mentioned is that there are also costs, both in increasing prices and old jobs which are vanishing in turn.
Germany can provide a good example of what may come to other nations. Many Climate Policy instruments like the cap and trade mechanism or an ecological fuel tax are already in place, giving the rest of the world a glimpse of what may come.
Looking at the purely green taxes alone, the additional costs for every single German household is 73.12 EUR ($106 USD) per month.
As a whole, current green policies in Germany impose charges of 35.1 billion euro per year, mostly on consumers. There is the Eco-tax -- a fuel tax amounting to 17.4 billion euros per year -- aiming to make driving more expensive.
The CO2-emission-certificates, which have to be bought by utilities in the European cap and trade scheme, mostly for the prevalent coal fired powerstations, cost 7.5 billion euros per year. This is in turn charged through ever increasing electricity bills to the households. Another 9 billion euros are added to electricity bills to pay for the solar and wind power installations.
The direction of Copenhagen talks will affect taxes in Germany as well.
This week, a study about the economic consequences of ongoing CO2-emission goals was released. For the scenario that a global climate treaty to limit and cut CO2 emissions can be achieved, it would look good for the German economy.
There are many companies offering energy efficient solutions, alternative energy and other green products. A global agreement in Copenhagen would mean global demand for these products and services, increasing foreign investment, making way for additional revenues and jobs would be created in Germany.
But, for the scenario that Germany would continue to go ahead on its own, it would spell disaster for the economy. Ignoring the policies already in place and only looking at the additionally planned emission cuts, it would cause over 55,000 jobs to disappear in the near term and the economy would bear a damage of several billion euros every year, according to a study by Prognos.
Unfortunately for the German economy, the government is determined to stick to very drastic CO2-cutting goals no matter what Climate negotiations yield. By 2020, the politicians want emissions to be 40 percent lower than in 1990, which is the most extreme target internationally.