The Role of Finance Ministries in Environmental Policy Making : The case of European Union Emissions Trading System reform in Denmark, Germany and the Netherlands

Summary, in English

Environmental policy-making increasingly involves ministries beyond environment ministries. In particular, finance ministries are important, since they control the public budget and address environmental issues from a perspective different from environmental actors. The role of finance ministries is especially salient in the European Union's (EU) Emissions Trading System (ETS), which has been subject to interventions to keep up the falling emission allowance price. The price of ETS allowances has dropped to a tenth of the expected price. The drop led to proposals for intervening in the ETS, including postponing the auctioning of emission allowances and structural reform. While the Netherlands and Denmark supported such intervention, Germany blocked an EU decision on the subject for months. To investigate whether the role of finance ministries explains the differences in government positions, this article analyses these three Member States. The analysis shows that finance ministries were involved in the policy processes and reluctantly supported intervening in the ETS. This position was due more to the desire to have a functioning ETS with minimal state intervention than to the fiscal impact of such intervention, as this impact was clouded in uncertainty. However, the finance ministries were not decisive in determining government positions, which were instead determined by the political orientation of the government (in Germany and the Netherlands) and by previous commitments to ambitious EU emission reduction targets (in Denmark). The analysis underlines the importance of studying the role of finance ministries and their different objectives (fiscal, macroeconomic) in environmental policy-making.

• Author: Jakob Skovgaard
• Department/s: Department of Political Science; BECC: Biodiversity and Ecosystem services in a Changing Climate
• Publishing year: 2017-07-04
• Language: English
• Pages: 351-351
• Publication/Series: Environmental Policy and Governance
• Volume: 27
• Issue: 4
• Links: http://dx.doi.org/10.1002/eet.1767
• Document type: Journal article
• Publisher: Wiley-Blackwell
• Topic: Political Science (excluding Public Administration Studies and Globalization Studies)
• Keywords: Bureaucratic politics; Economic crisis; Emissions trading; European Union; Finance ministries
• Status: Published
• ISBN/ISSN/Other: ISSN: 1756-932X