GLOBAL SUBSIDIES INITIATIVE

In November, the Green Economy Coalition wrote to the G-20 finance ministers ahead of their meeting in Scotland to outline how to remove fossil-fuel subsidies, stressing the need for a prompt phase-out of the subsidies in a way that ensures the poorest consumers are not adversely affected.

"It is inconsistent for governments to finance carbon-reduction policies whilst simultaneously increasing fossil fuel consumption through subsidies," said the letter. "The current annual fossil-fuel subsidy bill of hundreds of billions of dollars would be better spent on health, education, renewable energy or other actions that would accelerate the transition to a green economy."

Citing studies by the IEA, OECD and UNEP, the Coalition estimates that an end to subsidies would help stabilize the world climate by reducing global carbon dioxide emissions by 10%, or the equivalent of Russia and Japan's combined total.

"These subsidies are a massive diversion of public funds that could be better spent in other ways," says Mark Halle of IISD. "Subsidies create false impressions about the relative cost of lower-carbon energy alternatives and this is bringing us closer to irreversible climate change."

The letter also emphasizes the need for standardized and regular reporting on fossil-fuel subsidies, combined with rigorous research from the international community on the impact of existing subsidies and the likely consequences of their removal. Some kind of verification process is also recommended, to confirm that governments follow through on their commitments.

The letter was signed by a large number of Green Economy Coalition organisations, namely the Bellagio Forum for Sustainable Development, the Mistra Foundation, the International Institute for Sustainable Development (IISD, of which the Global Subsidies Initiative is one of its programs), the Ecologic Institute, WWF International, Consumers International (CI), the International Union for the the Conservation of Nature (IUCN), the Centre for Human Ecology, the International Institute for Environment and Development (IIED) and the Inspire Foundation for Business and Society.

A full copy of the Coalition's letter can be found on the Global Subsidies Initiative website.