Fossil Fuel Subsidies Surged to Record $7 Trillion
https://www.imf.org/en/Blogs/Articles/2023/08/24/fossil-fuel-subsidies-surged-to-record-7-trillion
Scaling back subsidies would reduce air pollution, generate revenue, and make a major contribution to slowing climate change
Fossil-fuel subsidies surged to a record $7 trillion last year as governments supported consumers and businesses during the global spike in energy prices caused by Russia’s invasion of Ukraine and the economic recovery from the pandemic.
As the world struggles to restrict global warming to 1.5 degrees Celsius and parts of Asia, Europe and the United States swelter in extreme heat, subsidies for oil, coal and natural gas are costing the equivalent of 7.1 percent of global gross domestic product. That’s more than governments spend annually on education (4.3 percent of global income) and about two thirds of what they spend on healthcare (10.9 percent).
Our findings come as the World Meteorological Organization says July was the hottest month on record, underscoring the urgent need to curb human-induced climate change.
As the Chart of the Week shows, fossil-fuel subsidies rose by $2 trillion over the past two years as explicit subsidies (undercharging for supply costs) more than doubled to $1.3 trillion. That’s according to our new paper, which provides updated estimates across 170 countries of explicit and implicit subsidies (undercharging for environmental costs and forgone consumption taxes). Download detailed data for different countries and fuels here.
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If governments removed explicit subsidies and imposed corrective taxes, fuel prices would increase. This would lead firms and households to consider environmental costs when making consumption and investment decisions. The result would be cutting global carbon-dioxide emissions significantly, cleaner air, less lung and heart disease, and more fiscal space for governments.
We estimate that scrapping explicit and implicit fossil-fuel subsidies would prevent 1.6 million premature deaths annually, raise government revenues by $4.4 trillion, and put emissions on track toward reaching global warming targets. It would also redistribute income as fuel subsidies benefit rich households more than poor ones.
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With global energy prices receding and emissions rising, it’s the right time to phase out explicit and implicit fossil-fuel subsidies, for a healthier and more sustainable planet.
https://www.imf.org/en/Blogs/Articles/2023/08/24/fossil-fuel-subsidies-surged-to-record-7-trillion
In ‘Climate-Wrecking’ Reversal, Shell Ditches Plans for Oil Production Cut and Hikes Dividend
By JAKE JOHNSON Jun 14, 2023
Original article republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0).
“It will always be profit over people and planet for polluters,” said one campaigner. “Shell simply cannot be trusted—with either their own meager targets or our futures.”
Shell announced Wednesday that it is raising payouts to wealthy shareholders and scrapping plans to cut oil production by up to 2% annually, a move that environmental groups said lays bare the futility of relying on fossil fuel corporations to voluntarily curb their climate-destroying activities.
The London-based company, which more than doubled its annual profits last year, said in a press release that it now intends to “achieve cash flow longevity” by keeping oil production stable until 2030 and boosting gas production, even as scientists say a rapid phaseout of fossil fuels is necessary to avert global climate destruction.
“It is unacceptable that Shell is betting on even more short-term returns to appease shareholders,” said Sjoukje van Oosterhout, Climate Case Shell’s lead researcher. “Shell is now throwing in the towel on reducing oil production and even scaling up gas production.”
Shell also announced Wednesday that it is hiking its dividend by 15%, a change that’s set to take effect this quarter. In an additional gift to shareholders, the company said it plans to buy back at least $5 billion of its own stock in the second half of 2023.
“Record profits, off the back of the energy crisis, should be boosting up green investment,” Jonathan Noronha-Gant, a senior campaigner at Global Witness, said in a statement Wednesday. “Instead it’s shareholder pay-outs and a doubling down on climate-wrecking fossil fuels.”
Shell had previously said its oil and gas production would fall by 1-2% each year through 2030. But as Bloombergreported, Shell justified the newly announced shift by claiming it “achieved its initial output-reduction plan—announced in 2021 amid a focus on cutting carbon emissions—faster than anticipated.”
Noronha-Gant called Shell’s announcement a “climate bombshell” that “exposes the hollowness behind the setting of such a target.”
“It will always be profit over people and planet for polluters,” Noronha-Gant said Wednesday. “Shell simply cannot be trusted—with either their own meager targets or our futures.”
Others responded with similar outrage. Climate scientist Bill McGuire wrote on Twitter that Shell CEO Wael Sawan “knows exactly what the consequences of this decision are.”
“People will die—are already dying,” McGuire tweeted. “I want to see him jailed—along with all the other CEOs who have been unequivocally complicit in crimes against humanity. And so should you.”
Shell’s announcement comes weeks after Carbon Brief released an analysis highlighting the oil giant’s tacit admission that limiting warming to 1.5°C by the end of the century means an “immediate end to fossil fuel growth.”
“Shell had previously claimed that oil and gas production could rise for another decade, even as warming was limited to 1.5°C,” Carbon Brief observed. “The dramatic shift in its new ‘Energy Security Scenarios’ is not explicitly acknowledged, but… is hidden in plain sight.”
“The immediate end to fossil fuel growth in Shell’s new 1.5°C scenario marks a dramatic shift from its earlier work, which had squared the circle between limiting warming to 1.5°C and continuing to expand oil and gas production by invoking implausibly-large forest expansion,” Carbon Brief added.
Shell insisted Wednesday that it is “aiming to achieve near-zero methane emissions by 2030” and “net-zero emissions by 2050,” but research released earlier this week showed that such commitments are often meaningless because companies rarely outline specific steps they plan to take to achieve their stated targets.
Last month, Friends of the Earth Netherlands published a report accusing Shell of overstating its spending on renewable energy solutions by including “the sale of flowers and sandwiches at its gas stations” in the total, along with “biofuels with a high carbon footprint.”
“The company continues to contribute to catastrophic climate change,” the group concluded.
Original article republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0).
Extinction Rebellion NL protests government subsidies to fossil fuels at A12 (yet again)
Translation of https://www.hartvannederland.nl/nieuws/politiek/extinction-rebellion-200-tot-300-deelnemers-eerste-dag-a12-mars by https://www.deepl.com
Between two and three hundred protesters will join a seven-day march from Arnhem to The Hague, organised by Extinction Rebellion. They will start on Sunday and walk along the A12. The march ends on 27 May, the day the group plans to block the A12 in The Hague again to protest against government subsidies to the fossil industry.
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It is the seventh time that Extinction Rebellion is planning to block the A12. At the last demonstration on 11 March, some 700 activists were eventually detained.
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Video of March 2023 protest.
During a demonstration by Extinction Rebellion on the A12 in The Hague a symphony orchestra played the second movement of Beethoven’s Symphony no.7. By doing so, the orchestra supported the demand of XR to stop the yearly 17.5 billion in fossil fuel subsidies by the Dutch government. The musicians are convinced that the beauty of music and of people connecting through music will also disappear if the climate crisis exacerbates.
At the moment the orchestra entered the road, police began to demand the protesters to leave or face arrest. Threatened by the deployment of water cannons, the orchestra decided to play anyway, which seemed to have a de-escalating effect. With this action the orchestra showed in a democratic way that beauty is tarnished.
Violinist Vera Beths : “Nature is a great source of inspiration for composers. You can find everything in it; harmony, dissonance, rhythm and form. We are in the process of disturbing this balance systematically. That has to stop. We have to start listening again.”
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Shell slammed over eye-watering profits amidst cost of living crisis
“One of the corporate scandals of our times”
Earlier this week, BP announced it had secured £4 billion in profits in the first three months of 2023. Today, another fossil fuel giant has confirmed its staggering profits. Shell made record breaking profits of £7.6 billion in the first quarter of the year.
The news has been met with outrage from trade unions who have slammed the government for not taking action on energy firm profiteering in the middle of a cost of living crisis partially driven by high energy bills.
TUC general secretary Paul Nowak said: “These sky-high profits beg the question – will the government ever have the backbone to tax the energy giants properly? While families across Britain have struggled to heat their homes, Shell have enjoyed a record cash bonanza.
“Our energy market is fundamentally broken. Struggling households shouldn’t be lining the pockets of shareholders and fat cat CEOs. We could all have lower bills if government taxed excessive profits, introduced a social tariff and created public ownership of new clean power. It’s time to end the energy racket.”
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