The Heat is On

Various heat waves have caused headlines in recent weeks, not only in Switzerland. According to meteorologists, the global climate has now heated up by almost one degree compared to the pre-industrial era. The effects are felt in many places - heat at work, permafrost thawing (not only in Siberia and Alaska), migratory pressure from regions suffering drought, etc. A vast majority of the Swiss population considers global warming to be a fact, man-made and a problem that needs to be addressed (Investigation on behalf of SRF, October 2017).

Climate Policy as an Election Campaign Topic

Environmental policy is also likely to become a hot topic in the upcoming election campaign. Switzerland has signed the Paris Climate Agreement and adopted the Energy Strategy 2050. Is it now ready to move forward on the path it has embarked on and seriously tackle halving CO2 emissions? The National Council "sunk" the CO2 law last December. Have some of them suddenly got cold feet and are now trying to win votes as “climate protectors”? Will voters approve of a wave of regulation, even if Switzerland's emissions are meaningless on a global scale? From our perspective, we hope that new voices will make themselves heard apart from the extreme demands of a "system change" and "let’s do nothing".

Courage for a Market-Based Climate Policy!

At Carnot, we have confidence in the power of the markets and in the industry's ability to innovate. We would therefore like to see clear, long-term rules that are open to technology. As experience shows, they would be fertile ground for marketable innovations. There are good examples of this in the building and transport sectors (among many others, of course). Emissions trading or CO2 pricing would achieve a great deal at a manageable cost. Countless subsidies, which then must be continually adjusted due to undesirable side effects and technological innovations, do not provide a reliable framework for progress. In any case, good intentions, calls for renunciation and a few bans are not enough for a gradual shift towards climate-neutral, resource-conserving technologies at reasonable costs.

Did you know? In Germany, the legislator has exempted the charging of electric cars at the workplace as a wage-like service from tax liability - after all, the Finance Minister also wants to contribute to electric mobility. But this does not apply to the electric scooter, which is currently conquering the cities. Here the development probably went too fast for the tax law!

This is an excerpt from Carnot Capital's commentary published on the 2nd of July 2019, of which the full version can be accessed here.