Environment

G20 Economies Under Pressure to End Fossil Fuel Subsidies

A policeman, wearing a mask to protect from severe pollution, secures the area near the Great Hall of the People before the opening session of the Chinese People's Political Consultative Conference (CPPCC) in Beijing, March 3, 2016. Credit: Reuters/Kim Kyung-Hoon/Files

A policeman, wearing a mask to protect from severe pollution, secures the area near the Great Hall of the People before the opening session of the Chinese People’s Political Consultative Conference (CPPCC) in Beijing, March 3, 2016. Credit: Reuters/Kim Kyung-Hoon/Files

Brussels: Energy ministers from the G20 major economies meeting in Beijing this week came under a three-pronged attack on June 28 over their failure to agree on a deadline for the phasing out of subsidies on fossil fuels.

Officials from the UN and the EU, plus 200 NGOs, urged the G20 to end years of fruitless talks and follow the lead of the G7 industrialised nations by setting a date for the end of subsidies on coal, gas and oil.

EU officials, speaking on condition of anonymity, said they were pressing for 2025 – the year already agreed by the G7 – at energy talks being held on June 29-30, which will be attended by European energy and climate commissioner Miguel Arias Canete.

An open letter from 200 NGOs called for a 2020 cut-off date.

UN talks last year in Paris reached a global agreement on curbing climate change and said that temperature rises need to be kept below 2°C versus pre-industrial levels.

“Post Paris, the question has become why wouldn’t you put a timeline on it?” Rachel Kyte, chief executive of UN body Sustainable Energy for All, said of the subsidies proposal.

Kyte, who previously worked for the World Bank as group vice president and special envoy for climate change, told Reuters that 2025 appeared to be acceptable to most but that subsidies should be phased out as soon as possible.

“With low oil prices, it is the time to do it – and the countries who are doing it now are reaping the rewards,” she said.

Although cheaper fossil fuels make it easier for governments to remove subsidies, political complications abound.

Japan, for instance, resisted efforts by the Organisation for Economic Cooperation and Development to phase out coal export credits, or preferential financing for companies that export coal technology, such as Toshiba, EU sources said.

The G7 nation is burning record amounts of coal for electricity generation and plans to use even more of the dirtiest fossil fuel to fill the gap after the Fukushima disaster paralysed its nuclear sector.

The 200 NGOs called for the G20 to set “a clear timeline for the full and equitable phase-out by all G20 members of all fossil fuel subsidies by 2020, starting with the elimination of all subsidies for fossil fuel exploration and coal production”.

(Reuters)