Quantcast
Popular

World's Richest Governments Aid Big Carbon's Efforts to Delay Climate Reckoning

One of President Obama's main climate policy thrusts was to persuade the world that since you often get what you pay for, the world should stop paying for more extreme climate disruption by subsidizing fossil fuels. Both the G7 and the G20 accepted Obama's lead—at least nominally.

Some countries did something. Revealingly, both rich and poor countries which were helping energy consumers get cheaper fuel reformed. The United Arab Emirates has dismantled its subsidy regime for gasoline. Indonesia eliminated its gasoline subsidies and capped diesel supports. India has moved very aggressively, first eliminating diesel supports, and now phasing out even the subsidized kerosene intended to help the off-grid poor pay for lighting their homes. (Dealing with electricity subsidies has proven a heavier lift).


But most richer countries, including the U.S. and China, the nations who started the clamor to get prices right haven't done so well. Their subsidies are mostly aimed at well-connected fossil fuel producers. Recent analysis shows that $60 billion a year is still flowing from 12 Organization for Economic Co-operation and Development members to oil, gas and coal producers, in a variety of forms, particularly export credits to encourage emerging markets to purchase oil, gas and coal technologies and equipment. This is four times as much subsidy as those same countries provide to clean energy.

So the world's strongest economies are handing out more than $60 billion in public funds to the world's biggest polluters, including some of the world's richest companies, aiding and abetting Big Carbon's effort to postpone the climate reckoning. At the same time they are pleading that their Treasuries are so depleted that they cannot keep their much less expensive long-standing promises to help finance the clean energy transition in developing countries.

Australia, for example, which was just chosen to lead the primary vehicle for climate aid, the Green Climate Fund, has provided $200 million for that agency. But Australia's Queensland State is proposing to spend $1 billion—five times as much—helping to build a single new railroad to enable an Indian mining company, Adani, to develop its Carmichael mine, a decision which caused one of Adani's competitors, Glencore, to snipe at "risky ventures that rely on taxpayer subsidies to get across the line and which will bring on massive volumes of additional coal supply into the market, which could undermine existing operations." (The Carmichael coal project is also expected to receive significant financial concessions on royalty payments).

The U.S., under President Trump, has become something of a caricature of what this fossil subsidy end game might look like. Trump campaigned with strong support from coal, oil and natural gas nationally—but messaged around his promise to bring back coal mining jobs in Appalachian states like Ohio, West Virginia and Kentucky.

Elected, he moved promptly to reverse a series of Obama administration regulations which would have improved environmental standards for oil, gas and coal extraction. Coal industry executive and even Kentucky Sen. Mitch McConnell conceded that these roll-backs, while good for coal company pocket books, would do nothing to bring back Appalachian jobs, which were being lost because of competition from cheaper strip-mined western coal, natural gas and renewables.

Trump next reversed a series of Obama reforms designed to ensure that companies mining fossil fuels from public lands paid fair royalties, and that leases were bid competitively. The roll-back added another billion dollars a year to the taxpayer give-away to public lands producers, but also made it even more difficult for labor intensive Appalachian coal miners to compete—speeding the loss of jobs. (The new administration's moves to lower environmental standards for gas drilling also hampered eastern coal).

How did Appalachian coal interests respond to the Trump administration giveaways to its competitors, western coal and natural gas? Predictably, they pled for even bigger subsidies for themselves. West Virginia Gov. Jim Justice, who just bolted the Democratic Party to join the GOP, asked Trump for a $15 federal subsidy for each ton of Appalachian coal, and claimed Trump had expressed support for the idea. If Congress were to appropriate these funds, it would add another $4.5 billion to the total U.S. government pay-off to fossil fuel producers.

But while these outrageous political payoffs waste taxpayer money and keep uncompetitive coal projects alive for a few more years, they don't change the underlying market realities. Last month the CEO of CSX railroad, founded to haul coal, and still getting a fifth of its revenue from the fuel, told analysts "Fossil fuels are dead….That's a long-term view. It's not going to happen overnight. It's not going to be in two or three years. But it's going away, in my view." And he backed up that prediction by revealing that his company would no longer make capital investments in its coal hauling business—no more locomotives designed to haul coal, no more investments in additional trackage—CSX is just going to let its coal business gradually wither. This week a Houston based energy trader told Bloomberg, "All the power market people that I know, we all think coal is going to zero."

So when you read claims that renewable energy isn't competitive yet with fossil fuels, or that it is economics that is slowing down the transition to clean energy, remember—the world's richest governments are throwing taxpayer money at well connected oil, gas and coal companies, cosseting these giants from the grim realities of true market costs—they represent a no-longer competitive past, and our health, our security, our climate and our economy will be better off the faster we move to the future of clean, low-carbon and cheaper energy sources.

Show Comments ()

EcoWatch Daily Newsletter

Sponsored
Popular
Michigan Department of Health and Human Services Director Nick Lyon, seen here speaking to the press about the Flint water crisis in 2016, will be the highest ranking official to stand trial over the public health disaster. Brett Carlsen / Getty Images

Judge Orders Michigan Health Director to Face Trial Over Flint Water Crisis Deaths

Michigan Department of Health and Human Services Director Nick Lyon will be the highest ranking official to go to trial so far as a result of an investigation into the Flint water crisis, The Associated Press reported Monday.

Judge David Goggins ruled Monday there was probable cause for Lyon to stand trial for involuntary manslaughter in the deaths of Robert Skidmore and John Snyder that prosecutors say were due to a Legionnaires' disease outbreak that Lyon was aware of a year before he alerted Michigan's governor, Michigan Live reported. Lyons is also charged with misconduct in office.

Keep reading... Show less
Politics
Coal-fired power plant near Becker, Minnesota. Tony Webster / Flickr / CC BY-SA 2.0

Trump's 'Dirty Power Plan' Could Cost More Than 1,000 Lives a Year

The U.S. Environmental Protection Agency (EPA) unveiled on Tuesday its long-anticipated replacement of the Obama-era Clean Power Plan. The new coal pollution rules will increase planet-warming carbon pollution and could cost more than a thousand American lives each year, according to the EPA's own estimates.

EPA Acting Administrator Andrew Wheeler released the "Affordable Clean Energy Rule" today under President Trump's directive. The new plan encourages efficiency improvements at existing coal plants to ensure they operate longer and allows states to weaken, or even eliminate, coal emissions standards. That's a clear difference from former President Obama's plan, which was aimed at phasing out coal and transitioning to cleaner power sources to avoid dangerous climate change.

Keep reading... Show less
Health
Two workers in protective gear scrape asbestos tile and mastic from a facility at Naval Base Point Loma in California. NAVFAC / Flickr / CC BY 2.0

Why Asbestos Is Still a Major Public Health Threat in the U.S.

Reports surfaced this month that the U.S. Environmental Protection Agency (EPA) had proposed a significant new use rule (SNUR) for asbestos in June, requiring anyone who wanted to start or resume importing or manufacturing the carcinogenic mineral to first receive EPA approval.

Keep reading... Show less
Animals
Rklfoto / Getty Images

Bipartisan Group of Lawmakers Wants to End EPA’s Cruel Animal Testing

By Justin Goodman and Nathan Herschler

A bipartisan group of lawmakers in Congress recently pressed the U.S. Environmental Protection Agency (EPA) on its "questionable" and "dubious" animal tests. The lawmakers' demand for information on "horrific and inhumane" animal testing at the EPA comes on the heels of a recent Johns Hopkins University study that found that high-tech computer models are more effective than animal tests.

Keep reading... Show less
Sponsored
Climate
Wikimedia Commons

Strongest, Oldest Arctic Sea Ice Breaks Up for First Time on Record

The Arctic is warming at a rate twice as fast as the rest of the globe, and now the region's thickest and oldest sea ice—also known as "the last ice area"—is breaking up for the first time on record, the Guardian reported Tuesday.

The breakage has opened up waters north of Greenland that are normally frozen-solid even in the peak of summer.

Keep reading... Show less
Energy
Climate Justice Edmonton

These Giant Portraits Will Stand in the Path of Trans Mountain Pipeline

By Andrea Germanos

To put forth a "hopeful vision for the future" that includes bold climate action, a new installation project is to be erected along the controversial Trans Mountain pipeline expansion route to harnesses art's ability to be a force for social change and highlight the fossil fuel project's increased threats to indigenous rights and a safe climate.

Keep reading... Show less
Sponsored
Popular
A worker inspects recycled plastic in a plastics factory. Getty Images

The Plastic Waste Crisis Is an Opportunity to Get Serious About Recycling

By Kate O'Neill

A global plastic waste crisis is building, with major implications for health and the environment. Under its so-called "National Sword" policy, China has sharply reduced imports of foreign scrap materials. As a result, piles of plastic waste are building up in ports and recycling facilities across the U.S.

Keep reading... Show less
Adventure
Aaron Teasdale

The One Thing Better Than Summer Skiing

By Aaron Teasdale

"There's snow up here, I promise," I assure my son Jonah, as we grunt up a south-facing mountainside in Glacier National Park in July. A mountain goat cocks its head as if to say, "What kind of crazy people hike up bare mountains in ski boots?" He's not the only one to wonder what in the name of Bode Miller we're doing up here with ski gear.

Keep reading... Show less
Sponsored

mail-copy

The best of EcoWatch, right in your inbox. Sign up for our email newsletter!