Saurav022/
Shutterstock.com
Thailand and Singapore, the price of coal should be about 500 per cent and 1,200 per cent higher, respectively, according to the true cost figures by the International Monetary Fund (IMF) (2017).
Hung Chung Chih/
Shutterstock.com 10
For vehicle fuels like diesel and gasoline, a similar scenario of under-pricing emerges. A significant portion of the hidden cost of these fuels comes from “vehicle externalities”, namely from traffic congestion and traffic accidents.
The consumer price of gasoline and diesel for vehicles should roughly be twice and three times higher, respectively. It is also worth noting that for Malaysia and Indonesia, both diesel and gasoline are given direct subsidies, as the consumer price is lower than the supply cost.
The direct fossil fuel subsidies in emerging and developing nations in Asia amount to USD70 billion per year. However, once the hidden costs are taken into account, the total fossil fuel subsidies in Asia add up to a whooping USD2,311 billion per year, or 13.2 per cent of the GDP. In comparison, approximately the same budget is spent by the governments on the educational sector.
9 Vehicles travel on the road amidst heavy smog in Delhi. Dirty fossil fuels like coal and petrol are often subsidised 10 A mask is worn against air pollution in Beijing. In China and India, more than a million lives are lost every year due to the burning of fossil fuels 11 To avoid the taxation in Vietnam, round baskets have been enlarged and made sea-worthy, hereby escaping taxation, because technically they are just big baskets 12 Vietnam taxes have shaped the built environment. The Vietnamese property tax is based on the façade width along the road, so, to save costs, narrow and deep building shapes have become commonplace
70 FUTURARC
To level the playing field, the fossil fuel subsidies should be quickly phased out, not just in Asia, but across the world. The environmental gains by doing so in Asia would include a 30 per cent drop in CO2
emissions from fossil fuels as
well as a 50 per cent drop in deaths caused by air pollution from fossil fuels.
According to climate economist Nicholas Stern, the environmental cost of fossil fuels is much higher, once the long-term effects of climate change are fully accounted for, hence, making the case for getting rid of the fossil fuel subsidies as soon as possible even stronger.
Unfortunately, the current stated energy policies
of Southeast Asia are set to double the CO2 emissions by 2040, a far cry from the 50 per cent reduction recommended by IEA. In recent years, state-backed capital accounts for about 60 per cent of the financing of fossil fuel power plants in Southeast Asia, but this can change with a change in energy policy.
POLICY TO ‘STEER’ OUR DEVELOPMENT
It is our respective governments’ role to steer clear of the existential threat of climate change. Interestingly, the German word for steering is steuer, which also means to tax. This is the right way to look at taxes, namely, as an effective tool that allow governments to steer the development of the nation in the desired direction.
Vietnam offers distinct visible examples of how taxes have shaped the built environment. The Vietnamese property tax is based on the façade width along the road, so, to save money, narrow and deep building shapes have become commonplace. Likewise, to avoid the taxation on boats, round baskets have been enlarged and made sea-worthy, hereby escaping taxation, because technically they are just big baskets.
Going forward, the global energy policies must align with the goal of preventing irreversible catastrophic climate change. This means that greenhouse gas emissions must be reduced by about 50 per cent by 2030 and drop to zero by 2050. For Southeast Asia, the International Energy Agency (IEA) is proposing a sustainable policy scenario that will cut CO2
9
emissions in half by 2040.
This is to be achieved primarily by implementing energy efficiency coupled with a substantial use of renewable energy.
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95
