Spain pushes for EU oil and gas tax to pay for climate change response

{"text":[[{"start":10.64,"text":"Spain wants the EU to tax oil and gas company profits to fund measures to adapt to climate change, after drought and wildfires ravaged western Europe during the region’s hottest summer on record."}],[{"start":22.64,"text":"Spanish minister for ecological transition (and third vice-president) Sara Aagesen Muñoz called on the EU to establish a climate adaptation fund, financed by measures including the permanent levy on oil and gas profits and the issue of more common debt to help it fund protections from extreme events driven by climate change."}],[{"start":42.32,"text":"The Spanish government made the recommendations in a letter and policy paper, seen by the FT, addressed to EU climate commissioner Wopke Hoekstra, who will deliver a new strategy on climate adaptation and resilience this autumn."}],[{"start":55.74,"text":"“Many member states are highly exposed, as recent events have clearly demonstrated,” Aagesen Muñoz said. The strategy should make Europe “capable of anticipating and collectively responding to climate risks” and “mobilising the resources needed to deliver the necessary investments”."}],[{"start":72.04,"text":"Wildfires and drought have already damaged Europe’s economy, with Spain pointing to estimates from Triodos bank that extreme heat could reduce GDP across the EU by around 1 per cent in 2026 and about 2.3 per cent by 2050."}],[{"start":86.52,"text":"Southern Europe, including Spain, France and Portugal, has experienced some of the most dramatic effects of heatwaves this year, including water shortages and wildfires."}],[{"start":96.8,"text":"Economists estimate the cost of the drought in Europe this summer was at least €50bn, with one bank putting the total cost as high as €180bn."}],[{"start":null,"text":""}],[{"start":105.8,"text":"The prospect of increasingly hot summers has led to the stronger impetus for Europe to invest in better preparing itself for climate change. “Reactive approaches to address climate vulnerability have proved unsustainable,” said Aagesen Muñoz."}],[{"start":119.72,"text":"The move follows separate calls for a Europe-wide windfall tax on profits of oil and gas companies from the finance ministers of Germany, Austria, Italy, Portugal, Poland and Spain, in a letter last month. The measure will be discussed at an informal gathering of finance ministers in Dublin on September 18 and 19."}],[{"start":136.907,"text":"But the European Commission has so far rejected pressure to impose windfall taxes on oil and gas companies benefiting from the present energy crisis, despite doing so following Russia’s invasion of Ukraine."}],[{"start":150,"text":"Officials have said that member states could bring in their own national schemes if they wished to do so, and Portugal has introduced a 33 per cent tax on extraordinary profits made in 2026."}],[{"start":161.96,"text":"Oil and gas industry executives have spent this year trying to rebuff the calls for fresh windfall taxes, even as they announced record profits after the Iran war sent prices soaring."}],[{"start":173.44,"text":"Darren Woods, ExxonMobil’s chief executive, told analysts at the end"}],[{"start":178.88,"text":"of July that Europe’s oil and gas deindustrialisation had left the region short of refineries, leading to higher prices when shortages emerge."}],[{"start":179.38,"text":"“There’s a huge temptation [ . . .] to scapegoat the industry. Penalising"}],[{"start":191.36,"text":"the businesses who have stood by those countries and provided that"}],[{"start":191.86,"text":"product going forward is very shortsighted,” he said. “We cancelled"}],[{"start":197.68,"text":"investments that we had planned for Europe, based on the last time"}],[{"start":201.92,"text":"they passed a windfall profits tax. And in fact we’re suing because we"}],[{"start":206.72,"text":"don’t think that’s a legal taking for the industry.”"}],[{"start":208.6,"text":"Meg O’Neill, the chief executive of BP, has also said fresh windfall taxes would be a “highly flawed response to the situation”, while Patrick Pouyanné, the chief executive of TotalEnergies, warned in May that if France introduced new taxes the company would stop capping the price of petrol at €1.99 per litre. “I think the French would prefer to benefit directly from the price cap,” he said."}],[{"start":233.6,"text":"Aagesen Muñoz has also called on climate risks to be integrated into infrastructure design so that new projects are resistant to climate change, as well as also supporting existing EU plans to improve shared resources for tackling extreme weather by increasing the EU’s fleet of firefighting planes and other reserves."}],[{"start":null,"text":""}],[{"start":null,"text":""}],[{"start":258.68,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1788756497_8320.mp3"}