Fossil fuel subsidies to hit $660 billion by 2020

Oct. 6, 2011, Toronto – A recent
International Energy Agency (IEA) report reveals that global fossil-fuel
subsidies reached almost $0.5 trillion in 2010. According to the IEA, this
figure is up $110 billion over 2009 and could reach $660 billion by 2020,
despite the G20 countries committing to eliminate these subsidies more than two
years ago, says the Global Renewable Fuels Alliance (GRFA).

At the 2009 Pittsburgh G20 summit chaired
by U.S. President Obama, leaders committed to eliminating both consumption and
production subsidies that topped $300 billion that year. The GRFA has tracked
activity on this promise; despite progress being made in several countries,
there appears to be little real progress in reducing these market-distorting
subsidies. According IEA’s report, these consumption subsidies reached $409
billion in 2010 and could top $660 billion by 2020.

“As we strive to develop alternatives to
oil we must recognize that alternative fuels are not competing on a level
playing field,” says Bliss Baker, GRFA spokesperson. “These massive
multi-billion dollar crude oil subsidies completely outweigh current biofuel
incentives and are a serious obstacle to the development of cleaner
alternatives.”

Next month, the G20 will meet in France,
and the issue of oil subsidies is on the agenda. However, the issue is likely
to be overshadowed by agricultural issues, according to the background
information being prepared for these meetings.

“It is time for the G20 to show leadership
and reverse this practice of never-ending subsidies to big oil. It is time to
move beyond crude oil and into a world with sustainable alternatives such as
biofuels and other renewable forms of energy,” says Baker.

All dollar figures are quoted in U.S.
dollars.