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Sunday, 22 November 2015

Currently, the G20 contributes over 450 billion US dollars a year towards the oil, coal and natural gas industries, a figure which should be decreasing after it promised to phase out such incentives in favor of cleaner energies. In the UK however, the opposite is happening, with around $10 billion given to fossil fuel production last year, almost twice the amount given to renewables. In a time where environmental preservation should be a priority, why is the government going back on its promises?
According to them, they aren’t. This is due to a stricter definition of what a subsidy is: government action that lowers the gross price below the international average. Because of this, the UK technically doesn’t give subsidies to fossil fuel companies. This flawed definition means that the government can get away with supporting dirty energy while slowing the development of cleaner sources; while not strictly unethical, it does nothing to help the environment in its time of dire need.
This is by no means a call to eliminate these subsidies overnight, as doing so would be disastrous; hundreds of thousands of jobs would be lost along with a plethora of other negative effects. The industry claims that subsidies reduce the financial risks in a highly-competitive market, which isn’t a complete lie. Though there needs to be urgency, the UK government should focus on changing priorities over time. Instead, it seems to insist on keeping oil, gas and coal at the top of the energy agenda
As the need for decarbonisation grows, the political stance continues to be one of ignorance; surely the problem will solve itself? Of course it won’t. Governments across the world need to acknowledge in full the potentially devastating effects of global warming before it’s too late. If we can’t work together with them, we will never find a solution. This is the first of an ongoing series of posts investigating the G20’s fossil fuel subsidies.
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