EU countries have ‘no concrete plans’ to phase out fossil fuel subsidies: report

The transport sector is the the main beneficiary of fossil fuel subsidies, receiving 44% of the total government support identified, including tax breaks to reduce the price of diesel, according to an earlier report. [crabchick / Flickr]

Not a single EU member state has so far spelled out a comprehensive plan to phase out fossil fuel subsidies, despite a commitment taken at the G20 ten years ago to eliminate them, according to a fresh analysis of the bloc’s 28 National Energy and Climate Plans.

Only nine EU countries have reiterated their commitment to end fossil fuel subsidies as part of their national plans, according to the analysis by the Overseas Development Institute (ODI), Friends of the Earth Netherlands, and Climate Action Network (CAN) Europe.

And while six of them envisage concrete steps, these are often limited to targeted subsidy schemes, rather than a comprehensive plan, the analysis found.

Worse, five EU countries – the UK, Germany, Greece, Poland, and Slovenia – are even looking to introduce new subsidies by 2030, many of which are labelled as ‘low-carbon transition support’. This includes a Greek scheme aimed at replacing diesel boilers with gas-fired ones and funding for liquefied natural gas transportation in Poland, the researchers found.

At the G20 in 2009, EU governments committed to stop subsidising fossil fuels, a pledge they reiterated at the G7 in 2016, agreeing to a deadline of 2025.

G7 countries pour $100bn a year into oil, gas and coal: study

Each year, at least US$100 billion goes to support the production and consumption of oil, gas and coal, according to a major new study published on Monday (4 June). That is despite a promise from all G7 and G20 members to stop subsidising fossil fuels by 2025.

“Ten years later, as the world is in the midst of a climate crisis, EU governments continue to provide huge sums of taxpayers’ money to fossil fuels, the single biggest cause of climate change,” said Laurie van der Burg, from Friends of the Earth Netherlands.

“If EU governments are serious about climate action, they must turn their longstanding commitments to ending fossil fuel subsidies into concrete action plans,” van der Burg said in a statement.

EU governments provided on average €55 billion per year in fossil fuel subsidies between 2014 and 2016, according to research contracted by the European Commission, a level which stayed broadly stable over that period.

At the same time, EU countries and Norway earned more than €400 billion in revenue from oil and gas taxation in 2017, according to the International Association of Oil and Gas Producers, underlining the difficulty for governments to end the subsidies. And when France introduced a fuel tax in 2018, it unleashed a wave of violent protests known as the ‘yellow vests’, which lasted for several months.

UK revealed as EU champion of fossil fuel subsidies

The United Kingdom spends the most in the EU on subsidising fossil fuels, according to a new report by the European Commission, which also found that EU-wide payments have failed to decrease despite the bloc’s commitment to the Paris Agreement on climate change.

The Commission has repeatedly called upon EU countries to phase out environmentally harmful subsidies, and recommended that governments spell out plans to eliminate funding for fossil fuels in their draft National Energy and Climate Plans.

First drafts of the national plans were handed in June this year, showing only eight EU countries had policies in place to eliminate coal by 2030, the dirtiest of fossil fuels. Final versions of the national plans are due by the end of the year.

“Member states have until the end of the year to get their homework done,” said Markus Trilling, co-author of the report for CAN Europe.

“Multiple times EU countries have declared their intention to phase out fossil fuel subsidies. The National Energy and Climate Plans are the opportunity to plan their phase-out and redirect investments towards renewable energy and energy savings,” Trilling said.

Only eight EU countries plan to phase out coal by 2030

The EU said Tuesday (18 June) that eight of its 28 member countries aim to phase out coal-powered electricity by 2030, triggering charges it is missing the mark under the Paris climate deal.

The transport sector received 44% of the total government support identified, including tax breaks to reduce the price of diesel, according to an earlier analysis by the Overseas Development Institute and CAN Europe, published in 2017.

Campaigners say ending fossil fuel subsidies will free up the necessary financial resources to invest into low-carbon technologies and reach net-zero emissions as quickly as possible.

Transport sucks up nearly half of Europe’s fossil fuel subsidies, report finds

European countries spend more than €112 billion per year subsidising oil, gas and coal production or consumption – including tax breaks on highly-polluting diesel – despite a pledge to phase out fossil fuels completely by 2020.

[Edited by Zoran Radosavljevic]

  • Overseas Development Institute (ODI): Fossil fuel subsidies in draft EU National Energy and Climate Plans: Summary | Full report (9 Sept. 2019)

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