Almost all governments in the world joined the Paris agreement in 2015 in an effort to tackle climate change. In the same year, many of the same governments paid about US$400 billion in direct and indirect subsidies to help people buy fossil fuels. Subsidies are government policies which make energy cheaper than under normal market conditions. They mostly go towards fossil fuels, since most of the energy we use comes from oil, gas or coal. As one of us noted in a review published in the journal Ecological Economics, fossil fuel subsidies are a popular and pervasive tool for helping people across the world have access to energy. But it isn’t clear whether both trends are possible. Isn’t there a contradiction between subsidising fossil fuels and meeting Paris climate targets? And, if the subsidies are removed, won’t many people suffer without cheap energy? Though recent analysis shows that the worldwide removal would not magically solve climate change, there are many reasons for reform beyond reducing emissions.
SPRU 9th March 2018 read more »
The race to exploit huge gas reserves in the eastern Mediterranean is raising regional tensions as disputes over ownership of offshore fields escalate into a war of words between countries with stakes in the potential energy bonanza. Turkey, Egypt, Cyprus, Israel and Lebanon have engaged in a round of verbal salvos in recent weeks over contested claims to gas reserves – the first of which were discovered a decade ago. The deposits could in time transform the fortunes of the region’s economies, but currently seem more likely to be the source of further confrontation. The process of exporting gas from the Levant Basin fields to energy-hungry Europe will be difficult enough even without the emerging tensions which, if they continue to grow, could complicate plans to build pipelines linking producer countries to consumer markets.
FT 9th March 2018 read more »