Evaluation of the 2008 increase in nitrogen oxide charge

Ficre Zehaie, Swedish Environmental Protection Agency

The nitrogen oxides charge (NOX charge) is a tax and refund system for stationary energy production introduced in Sweden 1992. In 2008 it was increased from 40 to 50 SEK/kg emissions of nitrogen oxides. The Swedish Government has commissioned the Environmental Protection Agency (Naturvardsverket) to evaluate the effects of the increase on the emissions and how the cost to businesses has been distributed amongst various industries.

The evaluation includes an interview study, an econometric analysis and some trend analyses. The results show that increase of the NOX charge in 2008 has no or limited effects on emissions. Furthermore the statistical and trend analysis indicate that the charge did not lower total emission even when compared to the levels in 1992, when the NOX charge was introduced. There are some redistribution of costs among industries but it is too early to draw conclusions compared to the trends observed before 2008.