A recent report by Overseas Development Institute (ODI) scientists, entitled 'Fossil Fuel Bailout: G20 subsidises for oil, gas and coal exploration', says that G20 countries are spending $88 billion per year supporting companies that are exploring for fossil fuels. This is more than double the global spending on exploration by the top 20 private oil and gas companies – which suggests that their exploration is highly dependent on public finance.
Five years ago, leaders of the G20 countries pledged to phase out ‘inefficient’ fossil-fuel subsidies – yet evidence presented in ODI's report points to a large gap between G20 commitment and action...
These are their key findings:
- The US provided some $5.1 billion in national subsidies to fossil fuel exploration in 2013 – almost double the level in 2009. Congress has failed to pass subsidy cuts proposed by the President in a series of budgets.
- Australia is providing $3.5 billion for the development of offshore and inland fossil-fuel resources.
- Russia provides $2.4 billion in national subsidies for fossil fuel exploration.
- The UK has introduced national subsidies for fossil fuel exploration valued up to $1.2 billion a year, including for promoting offshore and unconventional gas/oil exploration. In between 2009 and 2014 these were worth $838 million to Total (headquartered in France), $407 million to Statoil (Norway), $229 million to Centrica (UK) and $72 million to Chevron (US).
ODI calls for the subsidies from exploration and other fossil-fuel subsidies to be used to support for the transition to low-carbon development and universal energy access.
At the recent G20 Summit in Australia, Tony Abbott said that he would be "standing up for coal". He later reluctantly accepted a call for contributions to the international green climate fund and a repetition of the previous committment to “phase out inefficient fossil fuel subsidies”.
You can download the ODI reports and video here...