Syndicate content

Fossil Fuels Subsidies

Rachel Kyte: Takeaways from the Spring 2015 Climate Ministerial

Rachel Kyte's picture
Spring Meetings 2015


At this year's climate ministerial of the World Bank Group/IMF Spring Meetings, 42 finance and development ministers discussed phasing out fossil fuel subsidies, putting a price on carbon and mobilizing the trillions of dollars in finance needed for a smooth, orderly transition to a low-carbon economy. World Bank Group Vice President and Special Envoy for Climate Change Rachel Kyte describes the conversations in the room and the key takeaways.  

What, exactly, is a fossil fuel subsidy? A review of valuation approaches

Masami Kojima's picture
Half a trillion dollars? Two trillion dollars? “Only” 85 billion? Widely-differing numbers have been cited in recent years for global fossil fuel subsidies, making policy evaluation and consensus-building on reform challenging. Different definitions for subsidies, the boundaries of review, and the methods for calculating subsidies are responsible for the large differences and have contributed to the confusion.

Carbon Bubbles & Stranded Assets

Vladimir Stenek's picture
Also available in: العربية | Español | 中文

 Shutterstock

Packing an extraordinary amount of energy in little space, fossil fuels helped propel human development to levels undreamed of before the Industrial Revolution, from synthesizing fertilizers to powering space flight. But alongside energy, they produce health-damaging air pollutants and greenhouse gases.

Today, greenhouse gas emissions are higher than at any time in at least 800,000 years and rising, causing climate changes that threaten to reverse decades of development gains. Disruption of livelihoods, loss of food security, loss of marine and coastal ecosystems, breakdown of infrastructure, threats to global security: these are just a few of the risks identified in recent scientific reports.

In the absence of technology to permanently remove greenhouse gases and restore atmospheric concentration to safe levels, there is only one realistic solution: limiting additional emissions. It is estimated that to avoid the most damaging effects of climate change, over the next few decades we can at most emit a quantity equal to about 20 percent of total proven fossil fuel reserves.

Given fossil fuels’ omnipresence in our economies and lives, leaving them in the ground will have important implications, starting with the value of the very assets.