Mixed Greens: EU talks climate targets as fossil subsidies hit $2tn

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EU proposes 40% CO2 cut by 2030, 30% renewables; IMF says $2tn/yr fossil fuel subsidies a ‘major global problem;’ US renewables up, coal, nuclear down.

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The European Union has proposed a new package of carbon and renewable energy targets for 2030 that could see the introduction of a 40 per cent carbon reduction target, as well as a 30 per cent share target for renewable energy. BusinessGreen reports that policy ‘green papers’ unveiled Wednesday seek to drive EU action on carbon reduction, renewable energy development, and carbon capture and storage (CCS) technology.

The energy and climate consultation document, published in Brussels, said that while the 27-nation bloc was making “good progress” toward its 2020 goals to boost renewables and cut greenhouse gases by 20 per cent, a framework for the subsequent decade was necessary to provide investor certainty and to spur innovation and prepare for a global climate deal.

“2020 was yesterday for investors in the energy sector… and 2030 is tomorrow,” EU Energy Commissioner Günther Oettinger told reporters on Wednesday. “We want to make sure that industry and investors will get clarity through this green paper on how we will go forward after 2020.”

Oettinger also said that a carbon target alone was not enough to achieve the EU’s climate targets, and that a renewable energy goal should also be set for 2030. “The new framework must take into account the consequences of the economic crisis, but it must also be ambitious enough to meet the necessary long-term goal of cutting emissions 80 to 95 per cent by 2050.”

Global fossil fuel subsidies clock $2 trillion a year

Meanwhile, the International Monetary Fund has called for an end to energy subsidies, in its latest report showing global governments spend nearly $2 trillion a year to subsidise oil, natural gas, coal and electricity production. The report, released on Wednesday, shows the US as the world’s top overall fossil fuel subsidiser, with $502 billion directed to support energy industries in 2011. China comes in second, at $279 billion, Russia third at $116 billion.

According to the IMF report, fossil fuel subsidisation takes various forms, including direct support to the industries, consumer rebates and avoided taxes on pollution. And it recommends three key steps to eliminating the practice: develop a comprehensive, long-term phase-out plan; advance measures to protect the poor from higher energy prices; and consult with the public and affected stakeholders.

The report does not account for subsidies to renewable energy because, according to the IMF’s first deputy managing director David Lipton, they are generally too small to precisely measure. Lipton said it was time for the world to embrace both an end to government supports to fossil fuels and a price on carbon. “To me, the bottom line is that energy subsidisation is a major global problem, but it is a problem that can be solved,” Lipton said in a speech in Washington DC.

US energy landscape changing on Obama’s watch…

A new report published in the latest edition of the US Monthly Energy Review has shown that America’s use of renewable energy sources and natural gas has expanded rapidly during the Obama Administration’s first term while coal, nuclear power, oil imports and use, energy consumption, and CO2 emissions have all declined significantly.

Comparing data for 2008 – the last year of the George W Bush Administration – to that from 2012 – the last year of the Obama Administration’s first term – the report by the US Energy Information Administration (EIA) shows that domestic energy production from renewable energy sources like biofuels, biomass, geothermal, hydropower, solar, and wind grew by 23.48 per cent, with wind and solar more than doubling their output.

By comparison, total domestic energy production from all sources increased by just 8.15 per cent with domestic natural gas and crude oil production growing by 18.71 per cent and 29.47 per cent respectively. Output from nuclear power, meanwhile, declined by 4.47 per cent and domestic coal production dropped by 13.28 per cent. Total energy use declined by 4.16 per cent, petroleum consumption decreased by 6.95 per cent, and imports of crude oil and petroleum products fell by 17.32 per cent. America’s CO2 emissions dropped by 9.38 per cent.

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3 Comments
  1. D. John Hunwick 6 years ago

    This 40% cut by 2030 is just another example of delaying the inevitable. Setting a target like this without detailing the necessary steps to achieve it leaves the average person with no real understanding of the impact it must have on what we are doing now. What is needed is a list of actions for the average person to take on board sothey feel they are moving in the right direction eg (1) make sure Fed liberals don’t win uppoer house (2) write to politicians pointing out that subsidies for coal must cease (3) that money in banks must be transferred to Bank XXXX as an indication that investment is coal is not on (4)no more money for carmakers in Australia unless it is to build an electric car, (5) get PV and enlarge it to at least 4W, etc

  2. Concerned 6 years ago

    What coal subsidies?

    • Danny C 6 years ago

      If you want an example of fossil fuel subsidies, take the Latrobe Valley brown coal fired power stations. All present stations require billions of litres of water each year. Sold to them at less than 1 cent per kL. Residents pay nearly $2 per kL. The infrastructure was paid entirely by taxpayers in the SEC era. The privatised companies bought assets that were all taxpayer funded and are still using them without much improvement I might add. As well, Yallourn power station uses diesel powered bull dozers instead of dredgers to push the coal into the conveyors, thus making use of the diesel subsidy to primary producers. As well there is government funded research to improve generation efficiency and try to achieve the fantasy of clean coal with a branch at Monash university at Churchill. To round these subsidies off we have the carbon tax compensation paid to all the brown coal generators amounting to about $5.4 billion by 2015. If this level of support was put into renewables we would have cheaper, cleaner, more versatile and GHG free electricity grid in a very short space of time. I might add that after speaking to a Longford gas plant manager recently, they in the gas and petroleum industry don’t feel too happy about the free kick that coal gets as they do not have to pay the petroleum and gas resource rent tax that has been levied on their industry since 1987.

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