WOW! $775B A Year in Fossil Fuel Subsidies
Global fossil fuel subsidies are estimated at $775 billion to $1 trillion in 2012, reports Worldwatch Institute.
That’s a jaw-dropping number especially when you consider it is about 12 times the $66 billion that went to supporting renewable energy in 2010. (Worldwatch doesn’t provide an updated renewable subsidies number, but you can bet it is trending in the wrong direction.)
Plus, it doesn’t even begin to account for the other “costs” caused by fossil fuel subsidies in terms of resource availability, environmental damage and human health — an estimated $120 billion, according to the US National Academy of Sciences.
“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,” says Alexander Ochs, director of Worldwatch’s Climate and Energy program and co-author of the subsidies report. “Local pollutants from the burning of fossil fuels kill thousands in the US alone each year, and society makes them cheaper to continue down their destructive path.”
Sure, you could argue that as a percentage of overall generating capacity, renewable energy subsidies “cost” more. That’s because there is less of it, simply because it is not as established as other fuel sources we’ve been using for decades.
Estimates based on 2009 energy production numbers place renewable energy subsidies between 1.7¢ and 15¢ per kilowatt-hour (kWh), while subsidies for fossil fuels are estimated at around 0.1–0.7¢ per kWh, reports Worldwatch.
There are clear economic, environmental and national security benefits to starting to shift some of that fossil fuel money over to clean energy investment.
“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,” says Worldwatch.
But since a 2009 pledge by the Group of 20 major economies to reduce “inefficient fossil fuel subsidies” not one country has moved to initiate a subsidy reform, reports Worldwatch.
Considered from another perspective, the world’s governments are still spending at least $2 billion every day to support fossil fuels, up from about $1.4 billion daily in 2010.
Meanwhile, politicians fight over funding or renewing valuable tax incentives for clean energy projects — like the battle royale right now in the US over the wind production tax credit.
What a waste of energy.
For more on the subsidies analysis prepared by Worldwatch:
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