ABSTRACT
This chapter examines the politicisation of New Environmental Policy Instruments (NEPIs) within the European Union (EU). It assesses the influence of EU membership on the design and operation of NEPIs, paying particular attention to the internal market and the need to ensure that nationally implemented NEPIs do not restrict the free movement of goods and services between member states. Trade difficulties may arise for environmental taxes and charges where different tax rates are administered by member states for the same product or process, altering their relative cost over and above differentials created by normal factors of production. Tradable pollution permits raise similar issues for the internal market as environmental taxes and charges, since both apply fiscal incentives for polluters to engage in more environmentally responsible behaviour. Whether NEPIs will fundamentally alter the balance between the confederal and intergovernmental personas of EU environmental policy remains to be seen.
