Watch our short film on WTO reform of fossil fuel subsidies. The recent downward trend in international energy prices, combined with the rapid transition of the national energy mix and widespread liberalization of the domestic energy market, have called into question the mitigating potential of global fossil fuel subsidy reform. In this contribution, we focus on 25 countries that have high subsidies for fossil fuel consumption and appreciate the impact of subsidy reform on achieving country-specific emission reduction targets, as defined in national contributions (NDCs) based on different oil price forecasts. Our results indicate that the removal of fossil fuel subsidies could be an effective mechanism for meeting the NDC`s targets for a large subset of countries, although this would only result in an overall reduction in emissions of 1.8 to 3.2% in 2030, depending on the oil price scenario. Out of 17 countries with binding unconditional NPN targets, nine meet their 2030 commitments under the high oil price scenario and six below global low oil prices. In addition, 11 countries are meeting at least 50% of their NPD reduction targets, following the elimination of low-level subsidy subsidies amid a weak global oil price trajectory. The Panel recognizes the importance of ensuring that subsidy reform does not harm vulnerable groups and their development needs. Subsidy reform must be carefully designed so as not to restrict access to basic energy services or to increase poverty. The article why fossil fuel producer subsidies matter – shows how the removal of subsidies can prevent new fossil fuel projects by making them unprofitable. The authors note that the elimination of a single type of subsidy could reduce global oil consumption by 440 to 770 million barrels by 2030. The World Trade Organization (WTO) was established to ensure that economic progress is made in line with the goal of sustainable development and is one of the identified implementation agencies for work within the framework of the Sustainable Development Goals. Given its central role in the discipline of trade-distorting subsidies in all sectors, New Zealand sees the WTO as an obvious candidate for the international promotion of fossil fuel subsidies.
The group works to raise public awareness of fossil fuel subsidies and promote the benefits of environmental, energy security, social development and trade reforms. We are working to convince governments of the need for reform and to help them do so. The group calls for the reform to be ambitious and transparent. SDG 12.C (external link) specifically deals with fossil fuel subsidies and commits to streamlining inefficient subsidies for fossil fuels, which promote money consumption by eliminating market distortions based on national realities, including by restructuring taxation and phasing out these harmful subsidies, if any, to reflect their environmental impacts. , taking into account the specific needs and conditions of developing countries and minimizing the possible negative impacts on their development that protects the communities concerned. In June 2019, the Global Subsidies Initiative launched a report on ways to reduce greenhouse gas emissions by subsidizing fossil fuels, in collaboration with the Friends of Fossil Fuel Subsidy Reform (FFFSR) and the federal Department of Environment, Nature Conservation and Reactor Safety (BMU). The FFF recognizes the challenge of removing fossil fuel subsidies and that this will take some time.