The world's major industrial democracies spend at least $100 billion each year to prop up oil, gas and coal consumption, despite vows to end fossil fuel subsidies by 2025, a report said.
Britain, Canada, France, Germany, Italy, Japan and the United States - known as the Group of Seven (G7) - pledged in 2016 to phase out their support for fossil fuels by 2025 But a study led by Britain's Overseas Development Insitute (ODI) found they spent at least $100 billion a year to support fossil fuels at home and abroad in 2015 and 2016.
"Governments often say they have no public resources to support the clean energy transition," the study's lead author Shelagh Whitley told the Thomson Reuters Foundation."What we're trying to do is highlight that those resources are there (but) it is being used inefficiently. The G7 have pledged to phase out fossil fuel subsidies, but they don't have any systems in terms of accountability to meet the pledges - they don't have road maps or plans," added Whitley, head of the ODI's climate division.
However, another report makes interesting reading that exposes the chaotic conditions of capitalism. Plunging prices for renewable energy and rapidly increasing investment in low-carbon technologies could leave fossil fuel companies with trillions in stranded assets and spark a global financial crisis, a new study has found. A sudden drop in demand for fossil fuels before 2035 is likely, according to the study, given the current global investments and economic advantages in a low-carbon transition. The existence of a “carbon bubble” – assets in fossil fuels that are currently overvalued because, in the medium and long-term, the world will have to drastically reduce greenhouse gas emissions – has long been proposed by academics, activists and investors. The new study, published on Monday in the journal Nature Climate Change, shows that a sharp slump in the value of fossil fuels would cause this bubble to burst, and posits that such a slump is likely before 2035 based on current patterns of energy use.
Britain, Canada, France, Germany, Italy, Japan and the United States - known as the Group of Seven (G7) - pledged in 2016 to phase out their support for fossil fuels by 2025 But a study led by Britain's Overseas Development Insitute (ODI) found they spent at least $100 billion a year to support fossil fuels at home and abroad in 2015 and 2016.
"Governments often say they have no public resources to support the clean energy transition," the study's lead author Shelagh Whitley told the Thomson Reuters Foundation."What we're trying to do is highlight that those resources are there (but) it is being used inefficiently. The G7 have pledged to phase out fossil fuel subsidies, but they don't have any systems in terms of accountability to meet the pledges - they don't have road maps or plans," added Whitley, head of the ODI's climate division.
However, another report makes interesting reading that exposes the chaotic conditions of capitalism. Plunging prices for renewable energy and rapidly increasing investment in low-carbon technologies could leave fossil fuel companies with trillions in stranded assets and spark a global financial crisis, a new study has found. A sudden drop in demand for fossil fuels before 2035 is likely, according to the study, given the current global investments and economic advantages in a low-carbon transition. The existence of a “carbon bubble” – assets in fossil fuels that are currently overvalued because, in the medium and long-term, the world will have to drastically reduce greenhouse gas emissions – has long been proposed by academics, activists and investors. The new study, published on Monday in the journal Nature Climate Change, shows that a sharp slump in the value of fossil fuels would cause this bubble to burst, and posits that such a slump is likely before 2035 based on current patterns of energy use.
The findings suggest that a rapid decline in fossil fuel demand is no longer dependent on stronger policies and actions from governments around the world. Instead, the authors’ detailed simulations found the demand drop would take place even if major nations undertake no new climate policies, or reverse some previous commitments. That is because advances in technologies for energy efficiency and renewable power, and the accompanying drop in their price, have made low-carbon energy much more economically and technically attractive.
Prof Jorge Viñuales, co-author, said: “Contrary to investor expectations, the stranding of fossil fuel assets may happen even without new climate policies. Individual nations cannot avoid the situation by ignoring the Paris agreement or burying their heads in coal and tar sands.”
Nevertheless, Dr Jean-Fran̤ois Mercure, the lead author, from Radboud and Cambridge universities, told the Guardian, the transition was happening too slowly to stave off the worst effects of climate change. Although the trajectory towards a low-carbon economy would continue, to keep within 2C above pre-industrial levels Рthe limit set under the Paris agreement Рwould require much stronger government action and new policies.
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