Mon Nov 18 09:05:08 UTC 2024: **Global Fossil Fuel Subsidies Hamper Climate Change Efforts, Despite Pledges**

**November 18, 2024** – Despite international pledges to curb climate change, global fossil fuel subsidies remain stubbornly high, hindering efforts to transition to cleaner energy sources. A recent analysis reveals that these subsidies, which take many forms including direct financial aid, tax breaks, and relaxed environmental regulations, reached an estimated $1.5 trillion to $7 trillion annually in 2022, depending on the accounting method used. The discrepancy arises from whether the cost of environmental damage caused by fossil fuels is included.

The persistence of these subsidies, according to University of Notre Dame law professor Bruce Huber, stems from several factors. Politically, they provide governments with tools to secure political support and appease various constituencies. Practically, subsidies can prop up struggling industries or foster economic growth in specific regions. However, many existing subsidies are remnants of past policies, outliving their original purpose.

Eliminating these subsidies proves challenging due to their pervasive impact on consumer costs. Reducing them would raise prices for a wide array of goods and services, potentially leading to inflation and social unrest, especially among low-income populations. The energy price spike following the Ukraine conflict exemplifies this, as many governments prioritized affordable energy over immediate climate goals by increasing subsidies.

While increased fossil fuel prices can lower demand and emissions, creating an opportunity for reform, the political will to capitalize on these moments remains elusive. Despite commitments from the G20 and APEC to phase out inefficient subsidies, global subsidies nearly doubled in 2021 and 2022. Professor Huber argues that the continued reliance on fossil fuel subsidies undermines efforts to combat climate change and highlights the difficult balancing act between economic stability and environmental protection.

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