Rich states’ fossil-fuel breaks top climate aid

Bloomberg

Rich countries spend five times more on fossil-fuel subsidies than on aid to help developing nations cut their emissions and protect against the effects of climate change, the campaign group Oil Change International said.

In 2011, 22 industrialized nations paid $58.7 billion in subsidies to the oil, coal and gas industries and to consumers of the fuels, compared with climate-aid flows of $11.2 billion, according to calculations by the Washington-based group.

The data underline the steps developed nations could take to cut their own emissions. Eliminating the subsidies reduces incentives to pollute and help rich nations meet their pledge to provide $100 billion a year in climate aid by 2020, said Stephen Kretzmann, who founded Oil Change International.

“You can’t say you’re serious about fighting climate change until you stop funding the problem,” Kretzmann said in Doha, where envoys at United Nations climate talks entered their second week of talks Sunday. “It should be possible to phase out producer subsidies and use part of that money for climate finance to help cushion the blow of removing consumption subsidies in developing countries.”

Those payments enable consumers to fuel cars and heat their homes more cheaply. The International Energy Agency estimates they totaled $523 billion last year, mainly due to support paid out in developing countries. Production subsidies make it cheaper for oil and gas companies to extract the fuels. Leaders of the Group of 20 nations agreed at a meeting in Pittsburgh in 2009 to phase out fossil-fuel subsidies in the “medium term.”

Aid is a keystone of climate agreements, and developing nations from Barbados to China have complained in Doha about the lack of transparency surrounding $30 billion of so-called fast-start finance that industrialized nations pledged to pay for the three-year period ending in 2012.

Of the 22 nations examined, Slovenia and Finland both paid out more than 50 times in subsidies than in climate aid, according to the data. Subsides in the U.S. were highest, about $13.1 billion, or five times the $2.5 billion of climate aid it made last year.

Australia paid $8.4 billion in subsidies, while Germany and the U.K. paid $6.6 billion each. Japan had the best record, with aid payments of $5 billion exceeding fossil-fuel subsidies of $439 million.