Fossil Fuel to Clean Energy Subsidy Swaps: How to pay for an energy revolution
Reallocating some of the savings from fossil fuel subsidy reform to fund the clean energy transition can bring in economic, social and environmental benefits.
This report presents the case for a "subsidy swap"—reallocating some of the savings from fossil fuel subsidy reform to fund the clean energy transition.
Fossil fuel to clean energy subsidy swaps are already taking place. Globally, fossil fuel subsidies have fallen and global investments in renewable energy have exceeded investments in fossil fuels since 2008. Renewable global installed capacity additions have exceeded fossil fuel generation since 2014.
The report shares examples of four countries—India, Indonesia, Zambia and Morocco—that have already been taking concrete action and leading the way by implementing fossil fuel to clean energy swaps. Sharing these experiences is a key tool to show how swaps can be a feasible option for other countries.
When governments reform fossil fuel subsidies, there are many competing demands for how to reallocate resources, including spending on public health, education and social protection. This report makes the case for placing the promotion of clean energy alongside these other priorities and describes the economic, social and environmental benefits that such a move would bring, through a “subsidy swap.” The report sets out the international context of subsidy swaps; summarizes notable country experiences with swaps in India, Indonesia, Zambia and Morocco; and calls for policy-makers to include swaps as part of their fossil fuel subsidy reform implementation strategies.
You might also be interested in
Renewable energy transition is possible now in Canada
Renewable energy can now be scaled much faster and cheaper than fossil fuels, and the political and policy tools that allow citizens and communities to partner with utilities are being deployed at a global scale.
In Focus: A Draft WTO Agreement to Curb Harmful Fisheries Subsidies
This June, members of the World Trade Organization have the opportunity to establish a historic treaty to curb harmful fisheries subsidies. In a new video, IISD expert Alice Tipping delivers a concise overview of the draft agreement.
B.C. commits $282 million to CleanBC Industry Fund investment, applications now open
Companies are getting a $282 million incentive to develop more climate-friendly ways of doing business in B.C.
One BC Fossil Fuel Subsidy Reached $1.2 Billion Last Year
Last year the provincial government gave away $1.2 billion in a single fossil fuel subsidy known as the Deep Well Royalty Credit, a tax credit for hydraulic fracturing wells, according to new analysis by Stand.earth.