We know subsidies to the energy sector are large. The question is how large? Energy subsidies are inherently difficult to quantify; a challenge that is made harder by the reluctance of many governments to act transparently. We also know that energy subsidies can have a considerable impact on equity, the environment, and economies.

This month's Subsidy Watch raises issues of both the quantification and the impact of energy subsidies. Trevor Morgan, an energy economist and president of Menecon consulting begins with an introduction to energy subsidies. We then examine in detail an aspect of the energy sector that deserves special attention: biofuels.

In October the Global Subsidies Initiative published "Government support for ethanol and biodiesel in the United States", the premier among a series of reports we will be releasing over the next few months on subsidies for biofuels in particular countries. In addition to the United States, we are examining Australia, Brazil, Canada, the EU, and Switzerland. The GSI's Director of Research, Ronald Steenblik, explains why these reports have been commissioned, and why the results should be a matter of public concern.