This presentation was made by Benjamin Dequiedt, Ministry for an Ecological and Solidary Transition, France, at the 1st Workshop on Green Budgeting held at the OECD, Paris, on 20 June 2018

1. Green Budgeting -
Existing initiatives on
climate economic
analysis
Benjamin Dequiedt
Ministry for an Ecological and Solidary
Transition - General Commission on
Sustainable Development
June 20

2. 2
Introduction
Green Budgeting Statement implications :
Tax revenues
Expenditures
Assess the balance between negative and positive impacts in terms of
GHG
A trajectory to reach our goals

3. 3
Tax Pillar Investments Pillar
Positive NegativeNegativeNegativeNegativePositive
Expenditures Expenditures
RevenuesRevenues

4. 4
Tax Pillar Investments Pillar
Positive NegativeNegativeNegativeNegativePositive
Expenditures Expenditures
RevenuesRevenues
W&M
DTP
Landscape
EEA

5. 5
I. Tax revenues

6. 6
Tax Pillar Investments Pillar
Positive NegativeNegativeNegativeNegativePositive
Expenditures Expenditures
RevenuesRevenues
W&M

7. 7
« Ways and means assessment »
« Ways and means assessment »
Annexed to the Budget Bill
Exposes the tax revenues estimates
Identifies revenues from energy and environmental
taxes
Identifies tax expenditure
Useful to identify fossil fuel subsidies for some sectors

8. 8
« Ways and means assessment »
Agriculture
sectors
exposed
to
the
risk
of carbon
leakage
energy-intensive
societies
Boats
Road
Freight Transport
off-road
diesel
Aviation
0
2
4
6
8
10
12
Main Tax Expenditures on Energy taxes in 2018
Asapercentage
ofthetotalestimatedrevenues

9. 9
« Ways and means assessment »
Advantages :
Important number of programs integrated
Same timing as the annual Finance Bill
National budget
Blind spots :
Some tax expenditures are not mentioned (gasoline vs diesel)
No identification of the environmental dimension concerned by the taxe
expenditure
No quantification of environmental impact

10. 10
II. Expenditures

11. 11
Tax Pillar Investments Pillar
Positive NegativeNegativeNegativeNegativePositive
Expenditures Expenditures
RevenuesRevenues
Landscape

12. 12
Landscape of Climate Finance
Landscape of Climate Finance - I4CE
The Landscape tracks climate investment
expenditure and analyses how these
expenditures are financed.
32 billion euros invested in favor of climate
in France in 2016
64% of investment is made by households
and private companies in 2016
Household spending totalled 10.8 billion
euros
Companies and project developers
invested 9.8 billion euros in favour of
climate

13. 13
Landscape of Climate Finance

14. 14
Landscape of Climate Finance
Investments in renewable electricity generation:

15. 15
Landscape of Climate Finance
Landscape of Climate Finance - I4CE
Advantages
Allows to follow with good precisions the economic flows between the
sources (Public administration, Public finance, households), the project
initiators (private compagnies, public developers) and the sector which
benefit from the expenditures (Transport, industry, buildings etc.)
Allows to clearly identify the financing instruments (household deposits,
grants, public investments, concessional debt, etc.)
Blind spots :
Absence of tax revenues accounting (revenues from the carbon
component)
Absence of Environmentally Harmful Subsidies accounting
Absence of impact quantification
A lag of one year between the actual expenditures and the assessment

16. 16
Tax Pillar Investments Pillar
Positive NegativeNegativeNegativeNegativePositive
Expenditures Expenditures
RevenuesRevenues
DTP

17. 17
Document of transversal policy on the fight
against climate change
Document of transversal policy on the fight against
climate change
Annexed to the Budget Bill
Expose the means in the General Budget
implemented to tackle France’s abatement
objectives (-14 % in 2020 ; -40 % in 2030 ; -75 % in
2050)
Expose all the measures considered to have a
significant impact in termes of GHG mitigation :
Tax expenditures (example : tax credit for the
energy efficiency of buildings)
Budget expenditures (example : investments in
transport infrastructure)
Gathering of 39 programs across sectors (justice,
security, diplomacy, research, energy policy,
diplomacy, etc) and assessment of their climate
share

18. 18
Document of transversal policy on the fight
against climate change
Tax Expenditures - 2018 : 2,02 B€ Budget Expenditures - 2018 : 7,52 B€

19. 19
Document of transversal policy on the fight
against climate change
Advantages :
Important Number of programs integrated
Same timing as the annual Finance Bill
National budget
Blind spots :
Absence of tax revenues accounting (revenues from the carbon
component)
No harmful expenditure
Lack of quantification

20. 20
Tax Pillar Investments Pillar
Positive NegativeNegativeNegativeNegativePositive
Expenditures Expenditures
RevenuesRevenues
EEA

21. 21
Environmental Economic
Accounts
Environmental Economic Accounts
Environmental taxation
49,9 Md€ in 2016 (2,2 % of GDP)
Environmental protection expenditures :
 67,7 b€ in 2015 (39 % for water
treatment ; 35 % for Waste
management and recycling ; 4 %
for Air and Climate)
Employment for environmental goods
and services production
441 000 personnes in eco-activities
(1,7 % domestic employment),

22. 22
Environmental Economic
Accounts
Environmental Economic accounts
Advantages
Tacke into account several environmental dimensions (landscape, soil
protection, waste, water, etc.)
Allows comparability with other European States
Include tax revenues accounting
Blind spots :
A lag of three years between the actual expenditures and the assessment
Absence of Environmentally Harmful Subsidies accounting
Absence of impact quantification

23. 23
III. Long-term trajectory

24. 24
French Low Carbon Strategy
French Low Carbon Strategy
Gives strategic orientations to reach France
mitigation commitments in particular a
reduction of 75 % of GHG in 2050
Carbon budgets are defined by sectors by
periods of 4-5 years
Annual monitoring, assessment every 5 years,
and annual
Working group is currently screening and
gathering informations to assess the impact of
each recommanded measure
67 recommandations to reach these objectif :
Recommandations by sectors :
● Efficiency in the transport
sector
Transversal recommandations :
● Research and innovation
policy, Education, etc.

25. 25
French Low Carbon Strategy

26. 26
French Low Carbon Strategy
French Low Carbon Strategy
Advantages
Sets a GHG trajectory at the national and sectors level
Working group is currently screening and gathering informations to assess
the impact of each recommanded measure

27. 27
Conclusion
Current initiatives give mainly information on :
Tax revenues which potentially have an impact on GHG (energy tax)
Expenditures which have a positive impact on climate
GHG pathways (FLCS)
To achieve the Green Budget Statement, future works should
mainly focus on :
Coordination
Identification of potential gaps
Labelling economic flows
Definition of the relevant perimeter
Identification of Environmentally Harmful Subsidies
Tax reduction of fossil fuel
Expenditure
Impact quantification

28. FIN