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Colombian Carbon tax: Scaling up Presenter
from the national to international level Organisation
 THE CONTEXT

47,342,363
Population

4.8 Ton CO2eq / cápita (2010)

 THE COLOMBIAN LOW CARBON DEVELOPMENT
STRATEGY – CLCDS (2012 – 2017)

The Colombian Low Carbon Development Strategy (CLCDS) is a medium and long term led development program by
the Ministry of Environment and Sustainable Development (MADS), the Department of National Planning (DNP), and
sectorial ministries of Colombia that aims to promote national economic growth with low greenhouse gas (GHG)
emissions through the implementation of plans, projects, measures and policies that contribute to GHG mitigation and,
at the same time and strengthen Colombia’s economic and social development while meeting the global requirements
of efficiency, competitiveness and environmental performance.

1)Inertial Scenario

2)Reference Scenario

3)Low Carbon
Development Scenario
 Institucional Arengement - CLCDS

Ministry of Environment and Sustainable Development (MADS)

National Planning Department (DNP)

Ministry of Ministry of Ministry of

Ministry of
Ministry of Commerce, Agriculture Housing,
Minning and
Transport Industry and and Rural Cities and
Energy
Tourism Development Territories

Transport Minning Industry Agriculture Housing

SMAP SMAP SMAP SMAP SMAP

Solid
Electricity
Waste and
SMAP
Waste
Water
Hydrocarbons SMAP
SMAP
 NATIONAL SYSTEM OF CLIMATE CHANGE
(SISCLIMA) - 2016

 (Decree 298 / 2016) coordinate,

articulate, formulate, monitor and
evaluate policies, standards, strategies,
plans, programs, projects, actions and
measures, relation to adaptation to
climate change and mitigation of
greenhouse gases

Recently they decided the actions that are going to be part of the NDC.
43 actions
6 sectors
65 Million Ton CO2Eq
Intended Nationally Determined Contribution
(INDC)

 In its Intended Nationally Determined Contribution (INDC), Colombia

commits to unconditionally reduce its GHG emissions by 20% from the
2030 business-as-usual scenario, in particular through the
implementation of mitigation action plans in eight key sectors. The
INDC notes that the 2030 target could be strengthened to 30% with
international support. Colombia is also preparing Nationally Appropriate
Mitigation Actions (NAMAs).

 In 2010 the country produced estimated greenhouse gas

emissions (GHG) of 224 Mton of CO2eq, which represents 0.46%
of total global emissions for 2010.
 MITIGATION

 The Republic of Colombia commits to reduce its greenhouse gas emissions by 20% with respect
to the projected Business-as-Usual Scenario (BAU) by 2030.
ADAPTATION
100% territory with
climate change Plans
National System of indicators
of adaptation to cliamte
change
Operational tools and
integrated management of the
basin water
Six (6) priority sectors of the
economy will include climate
change
Strengthening of the awareness,
training and public education
strategy on climate change
Delimitation and
protection Colombia’s
36 “paramo” areas
Increase of more than 2.5
million hectares in
coverage of newly
protected areas
Inclusion of climate
change considerations in
projects of national and
strategic interest -PINES-
10 subsectors of the
agricultural sector
improved capabilities to
adapt
15 of the country’s
departments participating
in the technical working
groups on climate and
agriculture
 MEANS OF IMPLEMENTATION

 Colombia will contribute to the achievement of the global mitigation and adaptation
goals and targets through plans, programs and initiatives that will facilitate the
implementation of the necessary measures to achieve the INDC goals.
 THE BASIS OF COLOMBIAN CLIMATE
CHANGE POLICY

The “New Climate Economy”, report led by the Global Commission on

Economy and Climate, acknowledges that the current development rate is
only sustainable if climate change risks are identified and faced.
NATIONAL POLICY OF CLIMATE CHANGE

Objective: incorporate climate change

management into public and private decisions to
advance a climate-resilient and low carbon path of
development that reduces risks and enables them
to take advantage of the opportunities.
PARIS AGREEMENT RATIFICATION
 GREENHOUSE GAS (GHG) EMISSIONS BY
SECTOR

Colombia’s GHG emissions in 2013 were dominated by different sectors (of total emissions, respectively):

 Energy sector (49%),

 followed by agriculture (30%),
 land-use change and forestry (LUCF) (10%).
 Waste 7%
 Industrial processes (IP) 4%

 Within the energy sector, transportation and electricity and heat production contributed over 50% of the
sector’s emissions

 Colombia’s Biennial Update Report (BUR), submitted to the UNFCCC in 2015, includes a GHG inventory
for years 2010 and 2012. It too shows energy as the largest emitting sector (44%) in 2012, followed by
agriculture, forestry and other land use (AFOLU) (43%).
GEI EMISSIONS BY CATEGORY
2010 GHG EMISSIONS (MTon - CO2 eq)

50 Liquids
21 Solid and gas

Source: Colombian Biennial Update Report, IDEAM 2015

 EMISSIONS BY 2050
Participación del sector con respecto a las

27%
39% 44%
emisiones cada añ)

58%
42% 34%

8%
7%
6%
9% 12% 14%

2010 2030 2050

Industria
INDUSTRY Residuos
WASTE AFOLU Energía
ENERGY
Energy demand in transport sector

DIESEL GAS NGV BIOFUEL ETHANOL

Marginal Abatement Cost Curve (MACC) - Transport
Curve costs of emission abatement: oil, gas and
coal.
SOME DECISSIONS

 To comply with the NDC it was necessary:

 1. Establish an economic mechanism – Carbon Tax

 2. What category? CO2

 3. Define what type of emissions or activities would be taxing -

Liquids

 4. A possible period of time - 2030

 5. A value according to the MACC curves? Between 4 and 64 U$

TAX ARRANGEMENTS
COMPARATIVE RATES CARBON TAX

$5 USD
Ton CO2
(2017)
LEGAL TAX FRAMEWORK

•It contains the rules about

taxes governing, administered
TAX CODE by the National Directorate of
Taxes and Customs

Law 1819 •Creates the National

Tax Carbon for Fosil Fuels
of 2016 (Except Coal)

•Establishes the
Decree 926 procedure for
Tax not
of 2017 causation
HOW CARBON TAX WORKS IN
COLOMBIA
 CARBON TAX

$5 USD Ton Fosil Fuel Buyer

CO2 (2017)
Fosil Fuel
Importer

FINAL USER

TAX RESPONSIBLE

Emission Reduction and

APPLICATION OF
Removal Initiatives
TAX NOT CAUSATION
 CARBON TAX NOT CAUSATION

Emission Reduction and

Removal Initiatives

Declaration of Technical Support

Verification information

Verifier Organism – Public Retirement

Accredited by Report
1. ONAC – IAF
2. CMNUCC

APPLICATION OF
TAX NOT CAUSATION
 KEY STEPS FOR
INTERNATIONAL
IMPLEMENTATION
 WHAT IS NEEDED: AN APPROACH FROM
COLOMBIAN CASE

GHG Emissions
Legal Arrangements Verifier Organisms
Inventory

ISO 14064 – Carbon Footprint

Define Type of Bonds
Standar Verification

National

CDM

International
www.ctc-n.org UNFCCC.CTCN

ctcn@unep.org UNFCCC_CTCN