The International Monetary Fund has added up the government subsidies that went to support the fossil fuel industry in 2020: $5.9 trillion, or about $11 million per minute. On top of that, the analysis found that not one country priced its fuels high enough to cover the true supply and environmental costs, the Guardian reports. With international agreement that greenhouse gas emissions need to be seriously reduced to combat global warming prompted by climate change, and that the fossil fuel economy should be phased out, analysts said these subsidies are a bad idea.
"To stabilize global temperatures we must urgently move away from fossil fuels instead of adding fuel to the fire," said Mike Coffin of Carbon Tracker, a think tank. "It's critical that governments stop propping up an industry that is in decline, and look to accelerate the low-carbon energy transition, and our future, instead." The reports figures that tax breaks account for 6% of the total aid, per Market Watch, while 8% consists of subsidies cutting fuel prices. But the biggest break for coal, oil and gas producers is not making them pay for the deaths and poor health caused by air pollution and the heat waves and other impacts of global warming.
Just setting fossil fuel prices at the true cost would reduce global carbon dioxide emissions by more than a third, an IMF analyst said. G-20 economies decided in 2009 to gradually eliminate fossil fuel subsidies, which it called inefficient, by 2025. The IMF is unhappy with the progress toward that goal. There's a United Nations climate conference scheduled for Glasgow next month, and a reconsideration of fossil fuel pricing is the sort of issue that could be decided. IMF analysts said the conference "could not be timelier." (More fossil fuel stories.)
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