They could put the money into renewables, but there's nothing mandatory about that policy choice. The idea of a Pigouvian tax is to eliminate the market distortion negative externalities create. In general, you want to tax things you don't want, like pollution, not things you want, like productive work.
yes, but since this tax is done only at EU level, it causes industry offshoring and $ redistribution. EU could have just subsidized ren more instead of this tax. This way electricity/production prices would be lower while ren tech still supported
Very weak arguments there. Adding distortions is ok because other distortions exist? Non sequitur. Tariffs don't currently do everything therefore they cannot ever solve the problem? Also a non sequitur.
Europe, especially central and eastern away from the coasts, is in the unenviable position of being the renewable energy armpit of the world. So their choice is either not be competitive in energy-intensive industries in a renewable world or continuing to be competitive in a fossil-fuel-doomed world.
This dilemma leads to various kinds of magical thinking, like "nuclear will save us" or "climate change isn't real".
for nuclear at least we know what final result may look like, in France. We know both costs and timeline to achieve decarbonization. We also know more or less the same about Germany which took a different path, starting from 2000 under red-greens and schroder and continued by cdu. To me it sounds much more magical to hope DE will have anytime soon abundant cheap hydrogen to firm it's 80GW+ of gas plants according to Fraunhofer's ISE plan.
