February 5, 2013

Fossil Fuel Subsidies - Public Enemy #1

The International Energy Agency (IEA)'s chief economist has urged governments around the world to end the $0.5 trillion of annual subsidies given to oil and gas production.
"On one hand these countries talk about renewable energy, efficiencies and climate change, and at the same time subsidises fossil fuel energy - [it] does not make sense," he said. "All the countries and governments of the world need to pay attention to this issue.
"In the presence of these fossil fuel subsidies... we have no chance whatsoever to meet these climate change targets and provide room for renewable energies to compete with coal, oil and gas as they are artificially cheap as a result of those subsidies."
Figures from the IEA show that global fossil fuel subsidies jumped to $523bn in 2011, which Birol said represented an incentive to emit carbon equivalent to $110 per tonne.
In contrast, the EU emissions trading system currently provides a disincentive to emit carbon of less than $10 per tonne.
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