Price caps and other consumer support for petrol and diesel, electricity and gas amounted to around 1,100 billion dollars in 2022, or 12,000 billion kroner. The high prices after the Ukraine war have caused subsidies to more than double compared to 2021, shows a new report from the International Energy Agency IEA.
– It is troubling that they remain, even though all countries have promised for at least 14 years to remove or reform the subsidies, says Jacob Skovgaard, a political scientist at Lund University who has studied fossil subsidies.
Government subsidies to oil and gas make it harder to reach climate goals, the IEA says, because they discourage frugality and make renewable options less competitive.
Provides political support
Most of the fossil fuel subsidies counted by the IEA are given in developing or emerging countries. More than half is distributed in countries that themselves produce oil and gas (see fact box). Many countries consider the subsidies necessary to lower fuel costs for poor people. Critics consider the subsidies a way to buy political popularity and stability.
The total subsidies for fossil fuels are also greater than the IEA’s calculation. Among other things, neither support for producers nor tax breaks are included.
Threatens the climate goals
The record support for fossil fuels occurs at the same time as the UN’s climate panel warns that the world is about to miss the climate goals by a large margin. The IEA settles on another rapport that emissions continued to increase last year, up 1 percent.
– It is a difficult message for climate change. We have had declining subsidies for ten years, but with the war there was a rebound effect. But I think it will be a small bump in the curve that will not affect the transition in the long term, because there is now such momentum in renewable energy such as solar and wind power, says Måns Nilsson, head of the Stockholm Environment Institute.
