Key Indicators of Climate Change and the Energy Sector in 2016. Special Topic: Carbon Taxes for Austria

Real GDP (+1.5 percent) and gross domestic energy consumption (+1.4 percent) grew in parallel in 2016. Accordingly, there was no decoupling between the development of energy consumption and economic performance in that year, as is evidenced by the 11th issue of the WIFO key indicators of the energy sector and climate change. Greenhouse gas emissions increased at a lower rate than economic performance (+1 percent; i.e. relative decoupling) due to a substitution in energy carriers from coal to natural gas and mineral oil. But these emissions increased for the second year running, so that the decline starting in 2005 was not followed through. This has been a consequence of rising emissions in non-emission trading sectors (+2.6 percent), in particular CO2 emissions caused by the transport sector, which again showed strong growth (+4.1 percent), and those of buildings (+2.5 percent) reflecting a higher number of heating degree days. In a special section, the report deals with options for a revenue-neutral introduction of a CO2 tax for reducing emissions in non-emission-trading sectors in Austria and its potential effects on macroeconomic indicators and distribution of the tax burden.