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United Kingdom : New NERA Economic Consulting Study shows Oil and Gas Industry contributes billions of Euros in net payments to European governments.

Oil and Gas companies contribute more than 400 times as much revenue to EU governments as they receive in direct subsidies or other transfers, according to a study released today by NERA Economic Consulting, a leading global provider of independent economic advice and analysis in business, legal, and regulatory matters.

The study, Energy Taxation and Subsidies in Europe, commissioned by the International Association of Oil & Gas Producers (OGP), analyzes and compares the taxation and subsidy regimes applying to oil, gas, coal, wind, and solar power in the EU28 and Norway during the period 2007-2011. Using a methodology developed for the analysis, NERA's experts offer a new perspective on the important question of subsidy and government support to different energy sources. NERA's approach quantifies the full range of financial flows both to and from different sources of energy as a result of government policy, including direct subsidies, other transfers of funds, and major taxes.

NERA Associate Director Daniel Radov, who led the study, commented "Governments' treatment of different forms of energy through taxes and subsidies is an issue of global significance, and we hope that NERA's study helps to shed light on the situation in Europe."

Key Findings from Energy Taxation and Subsidies in Europe:

The EU28+Norway governments receive far greater revenues from oil, gas, and coal than these energy sources receive in the form of direct subsidies or other transfers.

Oil and gas contributed 433 billion in revenues to the EU28+Norway governments in 2011, and received less than 1 billion in transfers as a result of government policies.

Government revenues from coal accounted for roughly 36 billion in revenues in 2011, but the energy source received transfers of 4 billion as result of government policies.

NERA estimates that wind contributed 8 billion to government revenues in 2011. But, as a result of government policies, wind received transfers amounting to an estimated 9 billion a total net payment to the sector of 1 billion.

In 2011, solar power contributed 2 billion to government revenues, but received transfers close to 17 billion as a result of government policies.

Duties on motor vehicle fuels account for the largest single source of government revenues from energy. Duties on these fuels yielded over 180 billion in 2011, accounting for 84 percent of all excise duty revenues from energy.

NERA's study provides a clear, transparent, and consistent way of understanding government subsidy to, and revenue from, selected energy sources. The approach used has the advantage of producing results that can be readily compared across countries and energy sources.

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Publication:Mena Report
Geographic Code:4EXNO
Date:Jun 19, 2014
Words:436
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