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Defining and Measuring Fossil Fuel Subsidies

For many years, policy discussions have focused on strategies to bring down greenhouse gas emissions using taxes, permits and other regulatory or statutory limits.  Yet fossil fuel markets across the world remain littered with government programs subsidizing these emissions.  The subsidies are large and act as a negative tax on carbon, slowing the transition to cleaner fuels, weakening the impact of carbon constraints and absorbing a significant portion of government revenues in many countries. 

Reviewing, Reforming, and Rethinking Global Energy Subsidies: Towards a Political Economy Research Agenda

This article provides a review of global energy subsidies—of definitions and estimation techniques, their type and scope, their drawbacks, and effective ways to reform them. Based on an assessment of both policy reports and peer-reviewed studies, this article presents evidence that energy subsidies could reach into the trillions of dollars each year. It also highlights how most subsidies appear to offer net costs to society, rather than benefits, in the form of government deficits, increased waste, shortages of energy fuels, and aggravated environmental impacts, among others.

The World Nuclear Industry Status Report 2016

The World Nuclear Industry Status Report 2016 (WNISR) provides a comprehensive overview of nuclear power plant data, including information on operation, production and construction. The WNISR assesses the status of new-build programs in current nuclear countries as well as in potential newcomer countries. The WNISR2016 edition includes again an assessment of the financial status of many of the biggest industrial players in the sector. This edition also provides a Chernobyl Status Report, 30 years after the accident that led to the contamination of a large part of Europe.

Cost-Efficient Greenhouse Gas Reductions: Nuclear is No Silver Bullet

Although nuclear power is a source of low carbon electricity, it is by no means a clear solution to the challenge we face in reducting greenhouse gas emissions.  This presentation discusses common metrics to assess the most cost-efficient source of ghg emissions and reviews multiple studies indicating that new reactors are an expensive option relative to alternatives, and getting more so each year.  Cost escalation, lengthening delivery times on reactor projects, and oft-ignored concerns about proliferation create significant headwinds for the nuclear pathway.  In contrast, competitors cont

Subsidies to Energy Industries (2015 update)

Energy resources vary widely in terms of their capital intensity, reliance on centralized networks, environmental impacts, and energy security profiles. Although the policies of greatest import to a particular energy option may differ, their aggregate impact is significant. Subsidies to conventional fuels can slow research into emerging technologies, thereby delaying their commercialization. Subsidies and exemptions to polluting fuels reduce the incentive to develop and deploy cleaner alternatives.

Fossil Fuel Subsidies: Approaches and Valuation

Numbers ranging from half a trillion to two trillion dollars have been cited in recent years for global subsidies for fossil fuels. How are these figures calculated and why are they so different? The most commonly used methods for measuring subsidies are the price-gap approach-quantifying the gap between free-market reference prices and the prices charged to consumers-and the inventory approach, which constructs an inventory of government actions benefiting production and consumption of fossil fuels.

Global Energy Subsidies: Scale, Opportunity Costs, and Barriers to Reform

Government subsidies to energy producers, transporters, and consumers are widespread throughout the world and represent a large public investment in the energy sector. In theory, this investment could be funding a variety of social goals such as providing the poor with access to basic energy services and addressing common environmental problems linked to energy extraction and consumption.

Although some subsidies do address these types of concerns, most either do not, or do not do so effectively.

Subsidies to Energy: A Review of Current Estimates and Estimation Challenges

Presentation at a meeting sponsored by the Energy Research Institute of China's National Development and Reform Commission and the World Bank in Beijing, China.  The presentation reviews existing estimates of global subsidies to energy, including their magnitude, differences in estimation methods and assumptions, reporting trends, and emerging issues. 

We are grateful to the World Bank for making a Mandarin version of this presentation available as well.

Comments and suggestions for WEO nuclear chapter and updated Nuclear Roadmap

The IEA is producing two detailed assessments on nuclear energy in the coming months.  The first, a chapter in their vaunted World Energy Outlook, will examine in detail the prospects and challenges to nuclear energy going forward.  The second, produced jointly with NEA, will update their Technology Roadmap series, examining options and impediments to scaling nuclear around the world.

Ten Most Distortionary Energy Subsidies - Update (long version)

Complex security, environmental, and economic trade-offs remain the norm for the energy sector.   Government intervention is also the norm, and too often involves a torrent of energy plans, white-papers, and legislation.  In an ideal world, government policies should work in tandem with market forces to achieve an adequate energy supply mix that is cleaner and more diverse than what preceded it.  These synergies do not currently exist.  Instead, there are thousands of government energy market interventions in place around the world - many of which act counter to stated energy securi

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