Billions in subsidies
€37.5 billion euros. That is the amount that the Dutch state extends to the fossil industry, according to new research by SOMO, Oil Change International and Milieudefensie/Friends of the Earth Netherlands. No wonder that the energy transition has barely materialised in the Netherlands. Thanks to, among other things, this state support, the outdated revenue model of gas and oil is too lucrative to throw overboard.
What does this state support comprise? It includes a tax break on the gas use of big companies. In 2019, household paid 21 times more tax per cubic metre of gas than corporate industry (€ 42 cents compared to 2 cents). For every kilowatt hour of electricity, households paid 11 cents in tax compared to 1 cent for these bulk consumers.
In addition, large companies do not pay tax on fossil fuels used for energy generation. Plus, there is a tax discount on oil refining. This is (part of) the reason why two of the largest refineries in Europe, Shell's Pernis and BP's Europoort, are located in the Netherlands.
The goal to lure in energy-intensive industries to our country with these tax breaks has been achieved. Except we are now saddled with an industry that emits large amounts of CO2 and is barely making any effort to become more sustainable.
Fortunately, a rapidly growing climate movement is, in a variety of ways, demanding an end to this cossetting of the fossil industry and such actions will remain necessary until the policy has changed fundamentally.