Position Paper on GHG Pricing

Position Paper on GHG Pricing

Pricing of Greenhouse Gas Emissions caused by Air Travel Activity in the Max Planck Society

Authors in alphabetical order / Autor*innen in alphabetischer Reihenfolge:

Jakob Schweizera and Christoph Lenzenb

Affiliations / Affilierungen:

aMPI for Dynamics of Complex Technical Systems, Magdeburg; bMPI for Informatics, Saarbrücken;

Corresponding address:

DOI: https://doi.org/10.17617/1.mpsn.2021.02

Publication Date / Veröffentlichungsdatum: January 15 2021

Language: English

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Executive Summary

We encourage the Max Planck Society (“MPG”) to promote change towards a more climate friendly travel behavior by its scientists and employees. To achieve this, we propose a 3-step strategy with avoiding travel and choice of climate-friendly transportation being the most important measures. As a third part of this strategy, we propose implementation of an MPG-internal CO2 pricing scheme for air travel including compensation of greenhouse gas emissions. Several different CO2 pricing concepts exist for the compensation of CO2 such as compensation by paying fees to external NGOs (“External CO2 Compensation”, ECC), into an internal fund for CO2 Compensation (“Internal CO2 Compensation”, ICC) or for climate-protection-related research projects (“Internal CO2 Tax”, ICT). Compensation fees should be sufficiently high enough in order to provide an incentive to reduce travel activity. A typical amount is 25 €/t CO2. We doubt that such an amount will be sufficiently high as an incentive for climate-friendly behavior. On the other hand, higher compensation fees would lead to a great loss of funds. We therefore propose a scheme which offers both: sufficiently high CO2 prices to serve as an incentive to travel less, but with financial losses for the MPG not greater than standard CO2 compensation fees(25 €/t). Such a scheme is achieved by the combination all three concepts. For each component (ECC, ICC, ICT) the same amount of 25 €/t shall be allocated which adds up to 75 €/t. This amount should be sufficiently high as an incentive to reduce travel activity. However, only 25 €/t would be transferred to an external NGO for conventional CO2 compensation whereas 2x25 €/t would remain within the MPG. Corresponding fees should not be covered by central funds of the MPG but by the institute budgets in order to have an incentive for behavioral change. The CO2 pricing scheme shall be implemented for a test phase of two years, after which the effectiveness of each component shall be evaluated.Since June 2020, CO2 compensation was declared legal by the Bundesministerium für Bildung und Forschung (BMBF). We propose the immediate implementation of such an MPG-internal CO2 pricing scheme for air travel.

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