Ethiopia preparing carbon tax for vehicles -paper

Published 13:26 on September 2, 2015  /  Last updated at 16:27 on November 2, 2015  /  Africa, Carbon Taxes, EMEA  /  No Comments

Ethiopia is preparing to levy a carbon tax on vehicles as the African nation attempts to curb its GHGs, local media reported.

Ethiopia is preparing to levy a carbon tax on vehicles as the African nation attempts to curb its GHGs, local media reported.

The Ministry of Water, Irrigation and Energy is preparing the policy, the Capital Ethiopia newspaper reported on Tuesday, adding that it is expected to be ratified by the country’s parliament in the next Ethiopian year, which begins on Sept. 12.

No further details were provided, but Capital reported that the government is also considering increasing the import duty on high-emitting vehicles.

“We started exploring options that encourage the use of less carbon emitting vehicles and machines. Ethiopia has promised to create a climate change resilient green economy by 2025 and this is one of the steps to achieve that,” a ministry source told Capital.

Compared to other nations, transportation, including road and air, makes up a larger-than-normal portion of Ethiopia’s GHG output.

Ethiopia in June submitted a comprehensive INDC that included GHG cuts of 64% below business-as-usual levels by 2030 and an intention to sell carbon credits over the 2020-2030 period.

The fast-growing African nation emitted 150 million tonnes of CO2e in 2010 and will aim for its emissions to be 145 million tonnes by 2030 compared to the 400 million tonnes under a BAU scenario.

Most reductions will come from improving farming practices and protecting or re-establishing forests, with other cuts coming by expanding power generation from renewables and using more efficient technologies in the transport, industry and building sectors including cleaner cookstoves.

It added that implementing the INDC fully would cost an estimated $150 billion, despite 80% of the abatement potential costing less than $15 per tonne of CO2e.

Ethiopia, classed as a Least Developed Country with per capita emissions of 1.8 tonnes of CO2e, has already removed fossil fuel subsidies to enable new renewable generation for the 77% of its population currently lacking access to modern energy sources, its INDC said.

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