A new method of gauging the impact of fossil fuel subsidies on country-scale carbon emissions was recently examined in a report from The School of Public Policy at the University of Calgary. The report’s author Radek Stefanski utilized the method to create 30-year-long database incorporating figures from 170 different countries.
As the report shows, fossil fuels subsidies have been quite enormous over the last 30 years — pushing carbon emissions higher than they would be otherwise.
Radek summed this up rather clearly: “The resultant 170-country, 30-year database finds that the financial and the environmental costs of such subsidies are enormous- and steadily increasing. The overwhelming majority of the world’s fossil fuel subsidies stem from China, the US, and the ex-USSR; as of 2010, this figure was $712 billion or nearly 80% of the total world value of subsidies. For its part, Canada has been subsidizing rather than taxing fossil fuels since 1998. By 2010, Canadian subsidies sat at $13 billion, or 1.4% of GDP. In that same year, the total direct and indirect financial costs of all such subsidies amounted to $1.82 trillion, or 3.8% of global GDP.”
Also worth making note of here — the report found that if fossil fuel subsidies hadn’t been present in 2010, then carbon emissions that year would have been 46% lower than the actually were. This projection can of course be extrapolated beyond 2010, further back in time, as well as into the future.
The overall takeaway from the report is clearly that if governments are serious about cutting their countries’ carbon emissions, then the slashing of fossil fuel subsidies would be prudent.
The full report can be found here.