· It is important that the government already examine the feasibility of reaching the proposed target by 2030, before it becomes a national commitment under the climate charter.
· As a considerable part of the emissions reduction is expected to be based over time on technological developments that do not yet exist, it should be clarified that the sub-targets are only a roadmap, not a rigid individual quantitative framework.
· It is important to support the attainment of the targets through greenhouse-gas emissions pricing that will be imposed and rise gradually, for example, through adopting a “carbon tax”. Such pricing will support the implementation of the required adjustments by the market. It will enable the public and companies to choose the most efficient adjustments over time and the technologies that will help to reach the targets with the lowest cost to the economy.
The Governor of the Bank of Israel, Prof. Amir Yaron, participated today in the government meeting on the switch to a low carbon economy. Following are highlights of his remarks:
The proposed decision establishes targets for reducing the State of Israel’s carbon emissions by 2030 and 2050, in accordance with its commitment under international agreements on the issue. This is an important step, both in terms of the declaration on Israel’s continued participation in a process to which the international community ascribes considerable importance and as a road map for the preparation of steps that may be required. This is to the extent that advanced economies’ pressures grow to reduce emissions rapidly and for measures that will prevent unfair competition from countries that do not reduce emissions. In view of the considerable and increasing weight ascribed to the issue in diplomatic and economic meetings worldwide in recent years, it is good that the government is taking the initiative to move forward toward the targets for reducing greenhouse gas emissions.
The proposed decision includes a long-term target of reducing emissions by 2050 and a target for 2030. The proposal notes that the targets will be examined periodically, but it is essential that the government already examine the feasibility of reaching the proposed target for 2030 before it becomes a national commitment under the climate charter. To the extent that reaching the target requires steps with a high economic cost or steps that have marked uncertainty regarding their implementation, the target should be adjusted before any announcement on commitment.
The government’s decision today includes several emission-reduction sub-targets, by area of activity and sources of the emissions, through increasing the use of renewable energies. These targets are essential in that they signal to the economy and clarify to anyone involved, whether in the government or the private sector, that reducing the emissions in accordance with the target requires multidimensional activity. However, as a considerable part of the emissions reduction is expected to be based over time on technological developments that do not yet exist, it should be clarified that the sub-targets are only a roadmap, not a rigid individual quantitative framework.
In accordance with the above, it is important to support the attainment of the targets through greenhouse-gas emissions pricing that will be imposed and rise gradually, for example, through adopting a “carbon tax”. Such pricing will support the implementation of the required adjustments by the market. It will enable the public and companies to choose the most efficient adjustments over time and the technologies that will help to reach the targets with the lowest cost to the economy. Against the background of the uncertainty regarding types and future technological features that will make it possible to reduce emissions, the pricing of emissions is a tool with broad ramifications that will bring about the most efficient outcome in reducing emissions alongside reducing the process’s economic cost.
In conclusion, even though long term planning is desirable and important in the current international environment, there should be preparations for an unexpected acceleration in the effects of global warming, as should there be such effects, they are also liable to require an acceleration in the process of reducing emissions beyond what is proposed today. It is important that the entities responsible for the issue be prepared with alternative plans in case this risk materializes, as sudden steps are liable to impose heavy costs on the economy.