We can’t take on climate change without properly pricing coal, oil, and natural gas. But it’s a huge political challenge.
Umair IrfanMay 17, 2019, 12:50pm EDT
The world’s top climate scientists calculated in a startling report last year that if we want to limit global warming to 1.5 degrees Celsius this century to avoid devastating social and economic consequences, we need to reach net-zero emissions by 2050.
One big reason that goal is tough to hit is that we’re still heavily dependent on coal, oil, and natural gas — and governments support these forms of energy far more than clean energy.
The International Monetary Fund periodically assesses global subsidies for fossil fuels as part of its work on climate, and it found in a recent working paper that the fossil fuel industry got a whopping $5.2 trillion in subsidies in 2017. This amounts to 6.4 percent of the global gross domestic product.
Its last assessment in 2015 tabulated a value of $5.3 trillion — so not much has changed since then, despite growing alarm about rising temperatures and plummeting prices for alternatives like solar and wind energy. And it’s now clearer than ever that the political will to take on fossil fuels still hasn’t materialized.
So why don’t governments just pull the subsidies, save a ton of money, and fight climate change at the same time?
Well, as former Vox reporter Brad Plumer explained at length in 2015, the IMF is using a, let’s say, unconventional definition of the word “subsidy.”
Fossil fuels do get preferential support from governments, and it’s been critical in keeping some mining and drilling operations running far longer than they would have otherwise.
But the IMF’s calculation is intended to help us grapple with other, hidden advantages we give to fossil fuels. Undoing these cryptic subsidies will not be as simple as zeroing out a line item in a budget. However, confronting them could actually lead to reductions in greenhouse gas emissions while also addressing economic inequalities.
Here are some key takeaways from the new IMF paper.
Carbon polluters are dumping their waste in the atmosphere for free
Fossil fuel companies receive a significant quantity of what we might think of as conventional subsidies — government funding to reduce the retail price of fuel. The IMF describes these as “pre-tax” subsidies, and they amount to roughly $500 billion a year.
Countries like Malaysia, Nigeria, and Saudi Arabia are facing pressure to cut their subsidies for heating and transportation fuel (for budget reasons), but overall, these subsidies are on the rise again around the world.
Fossil fuel subsidies: the IMF says we pay $5.2 trillion a year – Vox
We can’t take on climate change without properly pricing coal, oil, and natural gas. But it’s a huge political challenge. Umair IrfanMay 17, 2019, 12:50pm EDT The world’s top climate scientists calculated in a startling report last year that if we want to limit global warming to 1.5 degrees Celsius this century to avoid devastating… [Read More]
