Fuel prices set to soar.

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Both the House of Representatives and the Senate have approved an ambitious, new climate-change target, which is likely to see transportation and domestic users among the hardest hit. Although the bill doesn't go as far as the "Environment Initiative"--pursued by the Social Democrats (SP), the Green Party and environmental groups--it nevertheless calls for a 20 per cent cut in national C[O.sub.2] emissions (based on 1990 levels) by 2020. The Environment Initiative called for a 30 per cent reduction; however, the groups behind it have indicated that they might be prepared to abandon their proposal following parliament's decision.

The new legislation will give the Federal Council powers to increase C[O.sub.2]-based fuel surcharges to a maximum of SFr 120 per tonne of C[O.sub.2]--a figure that could add 28 cents to the price of a litre of petrol and 31 cents to diesel. Domestic fuel bills could also soar, as the current heating fuel surcharges of SFr 36 per tonne of C[O.sub.2] could more than triple to SFr 120 a tonne.

Despite Federal Council calls for the target to include C[O.sub.2] savings achieved as a result of government support for overseas sustainable energy projects, the Senate ruled that savings must be achieved entirely within Swiss borders. With combined emissions from transportation and heating accounting for around 60 per cent of Switzerland's current greenhouse gas emissions, the Senate ruling means that these sectors must bear the significant burden of the cuts.

Mixed response

While the Green Party celebrated the decision, and the SP called it a "breakthrough in the climate debate", parties on the other side of the political spectrum--as well as business groups, such as Economiesuisse--are concerned by the development, fearing its impact on Swiss business. General Secretary of the Swiss People's Party (SVP) Martin Baltisser told the Tages Anzeiger that the fuel surcharges were a source of...

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