Quantcast

World's Biggest Economies Still Backing Fossil Fuels

Energy

The governments of the world’s major industrialized countries, the G20 group, are providing more than US$450 billion a year to support the production of fossil fuels.

That is almost four times the entire world’s subsidies to the rapidly growing renewable energy sector, as the International Energy Agency (IEA) estimates total global renewables subsidies in 2013 at $121bn.

The G20 group agreed in 2009 to phase out fossil fuel subsidies “in the medium term,” a pledge that was repeated at its 2014 meeting in Brisbane.

But the UK’s Overseas Development Institute (ODI) and campaign group Oil Change International (OCI) have now published a detailed analysis of G20 subsidies to oil, gas and coal production.

Empty Promises

Their “Empty Promises” report on G20 subsidies to oil, gas and coal production says researchers found that G20 support to fossil fuel production now totals $452bn.

The report singles out the UK for particular criticism, saying it “stands out as the only G7 nation significantly ramping up its support for the fossil fuel industry, with even more tax breaks and industry support handed out to companies operating in the North Sea in 2015.”

A similar report by the two groups a year ago said G20 subsidies for fossil fuel exploration alone amounted to an estimated $88bn annually.

The G20’s continued support for fuels—whose use increases greenhouse gas emissions and increases the risk of irreversible and catastrophic climate change—ignores the global imperatives to keep most current fossil fuel reserves in the ground.

It also disregards the faltering economic returns from coal and from oil and gas reserves, which are increasingly difficult to exploit.

The Intergovernmental Panel on Climate Change says at least three-quarters of proven reserves of oil, gas and coal must stay in the ground in order for the planet to have a two-in-three chance of remaining below the internationally-agreed 2C climate change threshold.

There is continuing scientific debate over how much of the world’s fossil fuels should remain unexploited, with many estimates ranging from a fifth to a third. The UN climate change conference in Paris, starting on Nov. 30, is likely to see a keen debate on the issue.

The ODI/OCI report, published before the G20 summit in the Turkish city of Antalya, examines three types of G20 government support in 2013 and 2014—the most recent years with comparable data.

It looks at national subsidies extended through direct spending and tax breaks; investment by state-owned enterprises, both domestically and internationally; and public finance extended through, for example, loans from government-owned banks and financial institutions.

Tax Breaks

Japan provided more public finance for fossil fuel production in 2013 and 2014 than any other G20 country, averaging $19bn per year—$2.8bn of that for coal alone. The U.S. provided more than $20bn in national subsidies, despite calls from President Obama to scrap support to fossil fuels.

Russia provided almost $23bn in national subsidies—the highest of all the G20 countries—and China’s investment in fossil fuel production at home and abroad amounted to almost $77bn annually.

Turkey, this year’s G20 host, is giving tax breaks to support its program of building more coal plants than any other OECD country, potentially raising its own greenhouse gas emissions by 94 percent over the next 15 years.

At the end of September, the U.S. and China agreed to give priority to the establishment of a firm deadline for the phase-out of fossil fuel subsidies as a key task during China’s G20 presidency in 2016.

The report recommends G20 governments adopt strict timelines for the phase-out of fossil fuel production subsidies, increase transparency through improved reporting of the subsidies and transfer government support to wider public goods, including low-carbon development and universal energy access.

YOU MIGHT ALSO LIKE

What is COP21? Find Out in This 2 Minute Video

25 Million Americans at Risk From Oil Train Traffic in Their Communities

Exxon + 49 Other Big Polluters Set to Be Investigated for Causing Extreme Weather Events

Investing in Clean Energy Will Create Millions of Jobs, Increase GDP and Raise Household Incomes

EcoWatch Daily Newsletter

The Lake Delhi Dam in Iowa failed in 2010. VCU Capital News Service / Josh deBerge / FEMA

At least 1,688 dams across the U.S. are in such a hazardous condition that, if they fail, could force life-threatening floods on nearby homes, businesses, infrastructure or entire communities, according to an in-depth analysis of public records conducted by the the Associated Press.

Read More Show Less

By Sabrina Kessler

Far-reaching allegations about how a climate-sinning American multinational could shamelessly lie to the public about its wrongdoing mobilized a small group of New York students on a cold November morning. They stood in front of New York's Supreme Court last week to follow the unprecedented lawsuit against ExxonMobil.

Read More Show Less
Sponsored

By Alex Robinson

Leah Garcés used to hate poultry farmers.

The animal rights activist, who opposes factory farming, had an adversarial relationship with chicken farmers until around five years ago, when she sat down to listen to one. She met a poultry farmer called Craig Watts in rural North Carolina and learned that the problems stemming from factory farming extended beyond animal cruelty.

Read More Show Less
People navigate snow-covered sidewalks in the Humboldt Park neighborhood on Nov. 11 in Chicago. Scott Olson / Getty Images

Temperatures plunged rapidly across the U.S. this week and around 70 percent of the population is expected to experience temperatures around freezing Wednesday.

Read More Show Less
A general view of the flooded St. Mark's Square after an exceptional overnight "Alta Acqua" high tide water level, on Nov. 13 in Venice. MARCO BERTORELLO / AFP / Getty Images

Two people have died as Venice has been inundated by the worst flooding it has seen in more than 50 years, The Guardian reported Wednesday.

Read More Show Less
Sponsored
Supply boats beside Aberdeen Wind Farm on Aug. 4, 2018. Rab / CC BY 2.0

President Donald Trump doesn't like wind turbines.

In April, he claimed they caused cancer, and he sued to stop an offshore wind farm that was scheduled to go up near land he had purchased for a golf course in Aberdeenshire in Scotland. He lost that fight, and now the Trump Organization has agreed to pay the Scottish government $290,000 to cover its legal fees, The Washington Post reported Tuesday.

Read More Show Less
A verdant and productive urban garden in Havana. Susanne Bollinger / Wikimedia Commons

By Paul Brown

When countries run short of food, they need to find solutions fast, and one answer can be urban farming.

Read More Show Less
Trevor Noah appears on set during a taping of "The Daily Show with Trevor Noah" in New York on Nov. 26, 2018. The Daily Show With Trevor Noah / YouTube screenshot

By Lakshmi Magon

This year, three studies showed that humor is useful for engaging the public about climate change. The studies, published in The Journal of Science Communication, Comedy Studies and Science Communication, added to the growing wave of scientists, entertainers and politicians who agree.

Read More Show Less