Fracking firms ‘should pay £6bn a year tax to compensate for climate change’

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Shale frackers operating in Britain should be paying £6bn a year in taxes by the middle of the 2020s to compensate for the damage wreaked on the environment, according to a study from Cambridge University.

The government has made clear drillers such as Cuadrilla Resources and IGas should provide sweeteners to local communities affected by their activities but it would also be right for shale gas producers to pay for contributing to global warming, argues Chris Hope, a parliamentary adviser and reader in policy modelling at the Judge Business School in Cambridge.

“Shale gas will contribute to climate change in two ways, from carbon dioxide emissions when the gas is burned, and from the fugitive emissions of underground methane that leak into the atmosphere when the gas is extracted,” he says.

“Under the Institute of Directors’ central production estimate and with a central methane leakage rate of 2%, the tax revenues for the UK will be about £6bn per year in current prices by the time shale really gets going in the latter half of the 2020s.”

Hope says that even though there is uncertainty about various aspects of climate change, the social cost of carbon produced when oil and gas is burned has been well assessed and is calculated at $100 a tonne of carbon dioxide.

via Fracking firms ‘should pay £6bn a year tax to compensate for climate change’ | Environment | The Guardian.

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