Fossil Fuel Industry Gets Subsidies of $11m a Minute, IMF Finds
by Damian Carrington (The Guardiain) Trillions of dollars a year are ‘adding fuel to the fire’ of the climate crisis, experts say — The fossil fuel industry benefits from subsidies of $11m every minute, according to analysis by the International Monetary Fund.
The IMF found the production and burning of coal, oil and gas was subsidised by $5.9tn in 2020, with not a single country pricing all its fuels sufficiently to reflect their full supply and environmental costs. Experts said the subsidies were “adding fuel to the fire” of the climate crisis, at a time when rapid reductions in carbon emissions were urgently needed.
Explicit subsidies that cut fuel prices accounted for 8% of the total and tax breaks another 6%. The biggest factors were failing to make polluters pay for the deaths and poor health caused by air pollution (42%) and for the heatwaves and other impacts of global heating (29%).
Setting fossil fuel prices that reflect their true cost would cut global CO2 emissions by over a third, the IMF analysts said. This would be a big step towards meeting the internationally agreed 1.5C target. Keeping this target within reach is a key goal of the UN Cop26 climate summit in November.
Agreeing rules for carbon markets, which enable the proper pricing of pollution, is another Cop26 goal.
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The G20 agreed in 2009 to phase out “inefficient” fossil fuel subsidies and in 2016, the G7 set a deadline of 2025, but little progress has been made. In July, a report showed that the G20 countries had subsidised fossil fuels by trillions of dollars since 2015, the year the Paris climate deal was reached.
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Five countries were responsible for two-thirds of the subsidies: China, the US, Russia, India and Japan.
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The G20 countries emit almost 80% of global greenhouse gases. More than 600 global companies in the We Mean Business coalition, including Unilever, Ikea, Aviva, Siemens and Volvo Cars, recently urged G20 leaders to end fossil fuel subsidies by 2025. READ MORE
