Fossil fuel subsidies now more than $A2 trillion just in G7 countries
The G7 group of industrialised nations has failed on a 2016 pledge to phase out “inefficient fossil fuel subsidies” by 2025, according to a new report.
Instead, the total volume of fossil fuel subsidies rose 15 percent from 1.18 trillion dollars in 2016 to 1.36 trillion dollars in 2023.
Of the G7 states, Canada was the only one to reduce fossil fuel subsidies with an 11% decrease since 2016.
In 2023, the U.S. spent the most on subsidies, followed by Japan and Germany.
Lower energy consumption during the COVID-19 pandemic saw a “temporary” reduction in subsidies, but spiking energy prices following Russia’s invasion of Ukraine increased support for coal, oil and gas in G7 countries.
In Germany, “price brakes” for gas and electricity, lower VAT on gas, as well as relief for industry, made up 38% of 2023 fossil fuel subsidies.
In 2023, Germany’s Council of Experts on Climate Change advised abolishing “climate-damaging subsidies”, among other measures.