Hakai Magazine

fishing boats at dock
In the European Union, fishing vessels pay no fuel tax. Critics say that ending the subsidy could pay for up to 6,000 new energy reduction and decarbonization projects. Photo by Juergen Wackenhut/Shutterstock

Campaigners Call for the European Union to Use a Fossil Fuel Tax to Fund Decarbonization

Nixing fuel subsidies for fishers could help pay for a transition to low-carbon fisheries.

Authored by

by Arthur Neslen

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This story was originally published by The Guardian and is reproduced here as part of Climate Desk, a journalistic collaboration dedicated to exploring the impacts of climate change. Leading up to Earth Day on April 22, Hakai Magazine and our partner outlets are sharing stories about the Great Decarbonization and the push to electrify everything.

The European Union lavished up to €15.7-billion in fossil fuel subsidies on its fishing industry over the last decade, but campaigners are calling for those funds to be redirected toward decarbonization.

Fuel tax exemptions for the fishing industry save so much money that they could pay the salaries of 20,000 fishers every year—or pay for 6,000 new energy reduction and decarbonization projects, according to an analysis.

Europe’s fishing fleet emitted at least 56 million tonnes of CO₂ between 2010 and 2020, more than twice as much as Malta over the same period, the paper says. But a true figure would be much higher, with studies indicating that practices such as bottom trawling release as much CO₂ as the entire aviation industry. Even so, Europe’s fishing vessels—like its aircraft—pay no fuel taxes at present.

“Vast sums of money could be put to use for good fisheries performance,” says one of the report’s authors, Laura Elsler. “The data clearly shows that by supporting the biggest emitters, fuel subsidies stand in the way of a transition to low-carbon fisheries.”

The European Union could generate €681-million a year if its fishing fleet was taxed at 33 cents a liter, and €1.4-billion if it paid the 67 cents a liter average rate charged to road transport users, the study says.

Switching tax streams to fund a decarbonization push would help the European Union “shift from unsustainable and unprofitable fishing to income-supporting and environmentally sound use of public money,” adds the report coauthor, Maartje Oostdijk, a researcher at the University of Iceland.

The European Union says it is committed to phasing out fossil fuel subsidies but an energy tax review under its Green Deal proposes only an ultra-low industry tax rate of 3.6 cents a liter for fishing vessels.

Even this tax band—described as “preposterously low” by the study—is being opposed by fishing countries including France, Spain, and Cyprus, which want the sector to continue paying no taxes.

Daniel Voces de Onaíndi, the director of the Europêche fishing industry association, says EU fishers have cut their greenhouse gas emissions by half since 1990.

“We are not waiting for NGOs to initiate this path,” he says. “However, given the lack of alternative propulsion technologies or net zero carbon fuels, fuel oil taxation will not drive any transition to decarbonization. It will only penalize the sector and even more under the [current] unprecedented fuel prices.”

The European Commission did not immediately respond to requests for comment.

Campaigners say revenues raised from a gradually imposed fuel tax could be used to fund the research and rollout of alternative technologies for fishing boats such as wind-assisted propulsion, batteries, and green hydrogen systems.

The report also proposes decarbonization projects to, for example, electrify harbors for shoreside power and provide more fuel-efficient fishing gear that reduces by-catch.

“The EU fishing industry faces the dual challenge of climate change and overharvesting,” it says. “Therefore, any investments to reduce carbon emissions must replace—not increase—fishing industry capacity.”

Depleted fish populations also cause greater emissions because fishing boats have to sail farther out to sea for longer periods to catch the same amount of fish.

The United States on Tuesday signed up to a World Trade Organization agreement committing to end subsidies for vessels involved in overfishing, or the fishing of species whose conservation status is unknown.

Flaminia Tacconi, a fisheries lawyer for the green legal group ClientEarth, says it was true that EU fishing vessels have already reduced their fuel emissions, but only “because there were way too many subsidized boats for far too few fish and the sector had to adjust to reality.”

She adds: “Keeping these fuel subsidies would be a schizophrenic approach if, on the one hand, you ask the sector to move away from fossil fuels and on the other, you continue to finance them through indirect fossil fuel subsidies.”

The report says 17 alternative subsidies—covering issues from safety at sea to protecting aquatic species—could outperform the current fuel subsidy for impact by 188 percent when measured against environmental, social, and economic criteria.

Rebecca Hubbard, the director of the Our Fish campaign, which commissioned the report, says: “There are so many other things we can do to support the fishing industry with better social, environmental, and economic outcomes. Yet the EU has chosen previously—and the fishing industry continues to support—funding fossil fuel companies instead of its own industry. It doesn’t make sense.”

A spokesperson for the European commission says: It is not accurate for the Report to state that Europe spent up to €15.7-billion on fossil fuel subsidies to its fishing fleet in the last decade. Our data indicates that the foregone revenue due to the existing tax exemptions amounts to about €1.14-billion annually. Our proposal to revise the energy taxation directive would end this exemption with a harmonized minimum tax rate, which will help to promote energy savings and the reduction of the dependency on fossil fuels in the fisheries sector—and for the rest of the EU economy.”