EU nations still subsidising fossil fuels, new report says
A new study by a consortium of NGOs has found that, despite making pledges to limit tax cuts and investment in fossil fuel industries by 2020, EU member states are still providing billions of euros in subsidies to these industries.
The report was written by climate change experts from Friends of the Earth Netherlands, Overseas Development Institute and the Climate Action Network Europe, who analysed the member states' draft climate and energy plans. The draft plans are intended to report information to the European Commission on fossil fuel subsidies including funding, price regulation, tax breaks or investment in oil, coal or natural gas.
The burning of fossil fuels has led to a rise in greenhouse gases in the planet's atmosphere and is a major cause of climate change around the world, the International Panel on Climate Change has said.
The study found that at least five EU nations are looking to introduce tax breaks or new funds for fossil fuel industries.
A further six EU countries claim in their draft energy plans that they do not provide tax breaks or funding to fossil fuels. The NGOs behind the report say that this is untrue.
A further ten EU member states included no information on tax cuts and funding.
The study's lead author, Laurie van der Burg, a climate and energy researcher at Friends of the Earth Netherlands said: "As part of the G20, EU governments committed to ending fossil fuel subsidies back in 2009. Ten years later, as the world is in the midst of a climate crisis, EU governments continue to provide huge sums of taxpayers’ money to fossil fuels, the single biggest cause of climate change."
In January, the European Commission estimated that there had been no decrease in fossil fuel subsidies and that around €55-billion in subsidies was being provided every year.
One of the countries claiming not to subsidise fossil fuel industries is the UK, which wrote in its draft energy plan that the energy subsidies section was "not applicable".
However, earlier this year the European Commission said that the UK provides annual subsidies of around €11.8-billion.
The UK's draft plan also contained a new investments in fossil fuels, including billions of pounds for heavy vehicles, as well as tax breaks for oil and gas exploration, according to Climate Action Network Europe, a coalition of 150 organisations in 35 European countries.
A Department for Business, Energy and Industrial Strategy spokesperson told Euronews that the United Kingdom does not "directly subsidise fossil fuels", adding "we know that there is no more to do and legislating for net zero will help to drive further action."
The spokesperson also added that the government is soon to release new plans to tackle emissions from heat, energy, aviation, transport and agriculture.
According to the NGOs, France "claims that no fossil fuel subsidies exist in the country, as the price of fossil fuels is increased through the use of a carbon tax," but the estimate by the European Commission for fossil fuel subsidies between 2014-2016 was €7.5-billion.
The French draft plan explains that in certain sectors, such as freight transport, taxes have been reduced in order to remain competitive internationally.
The NGOs said that Germany's draft energy plan did include some steps to reduce fossil fuel subsidies, and while it was transparent about funding flows, there are plans to introduce further tax incentives to fund fossil fuels up to 2026.
No section on energy subsidies was included in the draft plan from Poland, though it did include subsidies for natural gas, which creates lower emissions than oil or coal.
The European Commission said that if EU states "continue to provide fossil fuel subsidies", the transition to a clean energy economy could be "hindered".
At the G20 in 2009, EU countries committed to phasing out fossil fuel subsidies. As part of the Paris Agreement, there was a call for funding flows to be in line with a reduction in greenhouse gas emissions and "climate-resilient development."
In 2011, the European Commission released a roadmap to the creation of a "resource-efficient Europe" by 2020.
The NGO study said that some member states have increased transparency on the matter, with some giving in-depth details about subsidies.
Italy's draft plan said that a total of €16.9-billion in subsidies went to fossil fuels, out of a total €30.6-billion in energy funding.
However, only nine out of the 28 EU nations restated a commitment to end fossil fuel subsidies or make bigger green reforms, the NGO study said.
A report by the International Institute for Sustainable Development found that a reallocation of somewhere between 10% and 30% of the €334-billion spent on fossil fuel subsidies globally would go a long way to paying for the energy transition.
EU member states have until the end of the year to submit the final plans to the European Commission.
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