Increasing the Momentum of Fossil-Fuel Subsidy Reform: A Roadmap for International Cooperation

Introduction to the special issue: energy subsidies at the intersection of climate, energy, and trade governance

“…This explanation-which is premised on the assumption that a government's decision to initiate a challenge is based on the likelihood of success for the WTO dispute settlement mechanism-underscores the challenge of establishing that a fossil fuel subsidy will have 'adverse effects' and result in injury of other WTO members (Wold et al 2012). Moreover, for fossil fuel consumer subsidies a key challenge is to prove that such subsidies are 'specific', given that the benefits of such subsidies generally accrue to a broad group of producers and/or consumers (Lang et al 2010). Conversely, the adverse trade effects of renewable energy subsidies are usually more straightforward to demonstrate.…”

Seizing the opportunity: tackling fossil fuel subsidies under the UNFCCC

“…Combined with the already full agenda and consensus rule of the UNFCCC, this may make some options (e.g. mentioning phase-out goals or specific guidelines for reporting subsidies) difficult to achieve (Lang et al 2010).…”

Falling Oil Prices and Sustainable Energy Transition: Towards a Multilateral Agreement on Fossil-Fuel Subsidies

“…One lesson we have learnt from previous unilateral reform efforts is that governments usually bow to such pressure and postpone or reverse their reform plans for fear of losing political capital. An international agreement on fossil-fuel subsidies can help resolve such problems and achieve lasting reforms by binding governments into their subsidy reform commitment (Lang et al 2010). It can also serve as a hand-tying mechanism and help governments resist pressure to (re)introduce subsidies when oil prices start rising again, in the same way that international trade liberalization agreements help insulate governments from domestic protectionist pressure (Fernandez and Portes 1998).…”