By Cheryl Kaften, August 21, 2012
Total subsidies for renewable energy stood at $66 billion in 2010 – less than one-tenth of the government financing provided globally to the fossil fuel industry, according to new research from the Washington, DC-based Worldwatch Institute.
“These so-called hidden costs, or externalities, are in fact very real costs to our societies
that are not picked up by the polluter and beneficiary of production but by all taxpayers,” said Alexander Ochs, director of Worldwatch’s Climate and Energy program and report co-author. “Local pollutants from the burning of fossil fuels kill thousands in the United States, alone, each year, and society makes them cheaper to continue down their destructive path.”
Shifting official support from fossil fuels to renewables, Ochs pointed out, is essential
for “decarbonizing” the global energy system.
Such a shift could help create a triple win for national economies by reducing global greenhouse gas emissions, generating long-term economic growth and reducing dependence on energy imports.
“At the same time, a phase-out of fossil fuel subsidies would level the
playing field for renewables and allow us to reduce support for clean energy sources as well,” said Ochs. “After all, fossil fuels have benefited from massive governmental backing worldwide for hundreds of years.”
Progress toward a complete phase-out, however, has been minimal, according to Ochs. The
2009 pledge by the Group of 20 major economies to reduce “inefficient fossil fuel subsidies” has been left “vague and unfulfilled.” The lack of a definition has left countries to make their own determination if their subsidies are inefficient. As of August 2012, G20 countries had not taken any substantial action in response to the pledge: Six members opted out of reporting altogether (an increase from two in 2010), and no country has yet initiated a subsidy reform in response to the pledge.