France to Introduce Taxes to Reduce Fossil Fuel Use

France’s President Francois Hollande said that a carbon tax from 2014 and a tax break on home insulation would help the country to cut fossil fuel use by 30%.

In a speech on Friday, France called Europe to set the tone for a decreased reliance on oil and gas.

“Europe must set an example… It is an objective that can stir us, but will have to be adjusted to our growth performance and will suppose major technological innovations,” Hollande said.

The details of the new legislation are expected on Saturday. Prime Minister Jean-Marc Ayrault on Saturday could unveil the fiscal details, which could flow into the budget bill to be presented next week. 

France intends to introduce a carbon tax as the UK did in April. Exponents of the business communities contested the decision, arguing that the new legislation would simply increase taxes.

The new political move could trigger once more an arm wrestle between some ministers and the national industry. Hollande stated several times his intention to rule out exploration during his presidency. Earlier this summer, Agriculture Minister Stéphane Le Foll confirmed the position of the President, while Industry Minister Arnaud Montebourg said that unconventional fossil fuels are an opportunity for the country.

The country’s economy registered a 0.5% increase in the second quarter of the year, the strongest result since early 2011, driven by consumer spending and industrial output. Investment kept dropping.