Fuel subsidies defy green trend amid rising climate alarm

Experts say subsidies—which can come in the form of tax breaks, rebates, financial incentives or even overseas aid—are hard to a
Experts say subsidies—which can come in the form of tax breaks, rebates, financial incentives or even overseas aid—are hard to accurately calculate

Even as warnings of climate catastrophe and calls for greener economies grow ever louder, the world is still spending hundreds of billions of dollars every year to subsidise the fossil fuels that are causing the planet to overheat.

With mankind's plan to avert runaway global warming this century badly off course, scrutiny is mounting over how the taxpayer funding that companies receive to burn oil, gas and coal at heavy discounts is costing the planet in other ways.

Subsidies can come in the form of tax breaks, rebates, or even overseas aid and can keep consumer prices artificially low. They are also hard to accurately calculate, say experts.

But there is a growing consensus among economists that state-backed support for dirty energy is becoming increasingly hard to justify—both in financial and environmental terms.

In particular, the cost of renewable energy has plummeted in recent years.

The International Renewable Energy Agency (IRENA) says that the cost of generating power from onshore wind has fallen 23 percent since 2010, while solar electricity has tumbled 73 percent.

"Subsidies tend to stay in the system and they can become very costly as the cost of new technologies falls," Simon Buckle, head of the Climate Change, Biodiversity and Water Division at the Organisation for Economic Cooperation and Development (OECD), told AFP.

"Cost reductions like this were not envisageable even 10 years ago. They have transformed the situation and many renewables are now cost competitive in different locations with coal."

World electricity production by energy type
World electricity production by energy type (2000 and 2018). The world still spends hundreds of billions of dollars every year to subsidise fossil fuels.

Yet subsidies for remain stubbornly high globally.

An OECD working paper last year found a direct impact from spending on oil and gas on green energy investment, concluding "fossil fuel subsidies significantly reduce" the use of renewables.

The International Energy Agency (IEA) this week found that 2018 actually saw an increase in money going into new upstream oil and gas projects, while investment in renewable power of all kinds dipped two percent.

'Not viable'?

A recent OECD report on subsidies estimated that nations were providing around $370 billion (330 billion euros) in "support measures for fossil fuels".

This is "an order of magnitude (ten times higher) than global finance flows for biodiversity conservation and sustainable use," it concluded.

Using a different methodology factoring in the social and economic costs of air pollution, health risks, and the effects of climate change associated with fossil fuel use, the International Monetary Fund (IMF) released a working paper this month with some eye-catching figures.

It estimated that in 2015 global pre- and post-tax energy subsidies stood at $5.2 trillion—or 6.3 percent of global GDP.

The cost of renewable energy has fallen markedly since 2010
The cost of renewable energy has fallen markedly since 2010

The paper said China contributed the most to continued fossil fuel use, with the equivalent of $1.4 trillion in support of coal, oil and gas. The United States was second with $649 billion.

The European Union's support for fossil fuels cost $289 billion, it said.

The report estimated that if fossil fuel prices were "fully efficient"—that is, -free—in 2015, "global CO2 emissions would have been 28 percent lower (and) fossil fuel air pollution deaths 46 percent lower."

Dylan Tanner, executive director of pro-transparency monitor InfluenceMap, said that if the costs of healthcare, welfare and working hours lost were considered in the costing of fossil fuel subsidies, "these type of activities would be completely driven out of the market."

He said many companies generating energy from coal—the fuel that receives the most state funding—"are not valued as viable concerns" without continued .

'Market distorting'

In 2017 the V20 group of nations most vulnerable to the effects of climate change issued a call for G20 countries to phase out "market distorting" fossil fuel subsides by 2020.

Two years earlier, 195 nations signed up to the Paris climate agreement, which enjoined them to limit global temperature rises to well below 2 Celsius (3.6 Fahrenheit)—something climate scientists say would require a rapid drawdown in oil, gas and coal consumption.

The IMF has predicted air pollution deaths would be nearly halved worldwide without fossil fuel subsidies
The IMF has predicted air pollution deaths would be nearly halved worldwide without fossil fuel subsidies

Part of the problem, according to Tanner, is that governments tend to be vague about what constitutes an energy subsidy.

"The debate would be: 'this isn't a subsidy, this is support to a developing country which has asked for infrastructure assistance'," he said.

"But part of that is a subsidy for coal technology which hasn't sold a single unit on the open market without a government-backed loan."

While Buckle said fossil fuel subsidies need to be phased out far quicker than is happening now, he stressed that ending finance for oil and gas projects alone would not be enough.

"If you look at air pollution, the for that are huge," he said.

"Dealing with air pollution is not just an issue of fossil support and putting a price on emissions... We are talking about structural changes to our economies."


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© 2019 AFP

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May 17, 2019
The United States was second with $649 billion.

The European Union's support for fossil fuels cost $289 billion, it said.


Both of them tax fuels more than they subsidize them - the subsidies are merely part of the market regulation - mainly subsidies to corporations and the transport industry to keep the cost of goods down.

Remember, "If it moves, tax it. If it keeps moving, regulate it. If it stops moving, subsidize it."


May 18, 2019
Both of them tax fuels more than they subsidize them
And the revenue is then used in large part to build and maintain roads. Nice deal for the auto/fossil fuel industry right? Gubermint pays our industry subsidies - to distort the marketplace in our favor. Then collects some taxes from our product - in order to build out the infrastructure that will keep the world addicted to our products for ever. Oil industry profits - https://oilvoice....s-Sector
Sweet deal right? So people like Eikka are happy with crony capitalism - when it is for the oil and gas industry - but opposed when it is for renewable energy. Big problem is that our world is choking to death on burning fossil fuels. As always - profits for the entrenched world order - always outrank irrelevant little issues like the environment for our children.

May 20, 2019
"...concluding "fossil fuel subsidies significantly reduce" the use of renewables..."
Good idea! Ban subsidies for coal/oil/gas/fracking / carbon-free nuclear.
Let's compete!
Even heavily subsidized, solar and wind are unable to compete with hydro and carbon-free nuclear.
Worse yet, in reality, without cheap coal / gas to back them up, solar and wind are even more useless to prevent our children from freezing in the dark.
Without cheap coal / gas, intermittent renewables(land-intensive monstrosities) will die and Nature(birds/bats, natural landscapes, wildlife habitats) will thank us, leaving a better environment for our children.

That's it!
Ban subsidies for fossils and let's see if intermittent renewables can compete with Hydro and carbon-free nuclear without cheap coal / gas/fracking to back them up.

May 20, 2019
Even heavily subsidized, solar and wind are unable to compete with hydro and carbon-free nuclear
really? Show us the cost of unsubsidized nuclear. Give us real world numbers - of new build nuclear. We can do that for renewables -
Onshore wind is now as cheap as $27/MWh in India and Texas, without subsidy
http://ieefa.org/...sources/

And the costs keep coming down. Can you show us a cost curve for nukes for the past 50 years? We can for renewables. https://www.green...s.d8db2q

May 21, 2019
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23 hours ago
Proof, if proof were needed

Electric cars are not the solution
as just like combustion cars, burn fossil fuel
electric cars burn fossil fuel
if this world ditched this fossil fuel
without taking every acreage of farming land
there is not sufficient land to place wind and solar generators
to replace all these combustion engines of industry, automobiles, houses , shops and street lighting
without PowerStation's
which are powered by fossil fuels
the only solution to this enormous demand
if fossil fuels are excluded
Is Nuclear and Fusion
if this world ditched fossil fuel
would entail taking every acreage of farming land
which would result in these worldly population billions starving
As the last worldly population billion shuffles of this mortal coil
This Earth, this world would be free of this climate catastrophe
Can the last person to leave, please turn of that light

As then this climate catastrophe is no more

23 hours ago
"And the revenue is then used in large part to build and maintain roads. Nice deal for the auto/fossil fuel industry right?"

Roads?, yea we don't need no stinking roads! Onions has it right, cities should be supplied by pack mules since they only need a very narrow trail.

23 hours ago
The only proper way to determine which industry receives a greater subsidy per joule produced is to compare the taxes paid minus the actual taxpayer monies received for renewables and fossil. Only when THAT figure is published can one make a reasonable determination about the fairness of "subsidies".

20 hours ago
...Onshore wind is now as cheap as $27/MWh in India and Texas, without subsidy...
But don't forget to buy a diesel/gasoline-generator to prevent your children from freezing to death when wind isn't blowing and also to compensate fluctuations of production and demand all time.
But no problem, Texas has abundant supplies of cheap oil/gas/fracking to compensate intermittencies of the "unreliables".
"Every turbine and solar panel put up needs back up. Two systems. Two costs. Two carbon footprints. Not much saved of anything in reality."
"Intermittent sources like all wind and all solar need firm backup to 100% of their capacity. So, if you have to build the firm backup anyway, what do you need wind and solar for? Nothing."

"Unsubsidized wind, solar are now the cheapest bulk generation sources" "batteries never included" neither coal/gas-fired backup plants nor integration costs.
Not even the people who propagandize wind/solar buy with their own money these useless placebos.

11 hours ago
granville
if this world ditched this fossil fuel without taking every acreage of farming land
there is not sufficient land to place wind and solar generators to replace all these combustion engines of industry...
Just saying something does not make it true granville. https://www.forbe...090fd440

11 hours ago
But don't forget to buy a diesel/gasoline-generator to prevent your children from freezing to death when wind isn't blowing
or you could use solar panels, geothermal, hydro, storage, tidal, wave, and of course other strategies such as interconnections etc.
Not even the people who propagandize wind/solar buy with their own money these useless placebos.
Many do - https://www.green...s.cxu2il
Keep telling the lies Wille - we see you....

11 hours ago
MR166
Only when THAT figure is published can one make a reasonable determination about the fairness of "subsidies"
And why is that specific equation important to you? For decades - the nuclear industry has received massive gubermint supports. Not a peep from the hypocrite conservative liars. They love crony capitalism - when it lines their pockets. BUT OHHHH - now it has to be fair. We have to try to do calculations that are impossible to do. Fossil fuels receive so many different types of supports - you could never untangle all the threads. You are such a bunch of hypocritical, double standard, two faced liars.

11 hours ago
Forty tornadoes touched down today.

Butttheresnoglobulwaruming /s

11 hours ago
Oh and along with the forty tornadoes we have the first named hurricane of the season.

Butttheresnoglobulwaruming /s

11 hours ago
King Canute tries to hold back the tides.

I seriously doubt he was stupid enough to drown. But it sure screwed up his theology.

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