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G-20 leaders to pledge to end subsidies for fossil fuels

Countries may eliminate tax breaks and direct government assistance for oil, coal and other fossil fuels. Conservation groups expect strong resistance from energy companies.

September 26, 2009|Jim Tankersley

PITTSBURGH — World leaders at the Group of 20 summit pledged to phase out subsidies for fossil fuels in the "medium term" Friday, a nebulous goal that the leaders nevertheless said could make a noticeable dent in global warming.

The pledge is purposely vague, though it is clearly directed at tax breaks and government assistance for oil, coal and other fossil fuels. It does not set a date for subsidy phase-outs, nor does it specify what would count as a subsidy or how countries would police compliance.

The pledge explicitly protects cash payments and other programs designed to help the poor afford energy, along with subsidies for renewable energy. But it leaves considerable gray areas. For example, it is unclear whether a prohibited subsidy would include greenhouse-gas emissions permits to be issued free to coal plants that would be created under climate legislation passed recently by the House.

Environmentalists hailed the pledge as a building block for international efforts to curb global warming and as a small burst of momentum in the run-up to international climate-change treaty negotiations in Copenhagen in December.

Conservation groups also said countries would face strong opposition from oil, coal and other energy companies that profit from government support. President Obama, for example, has met some resistance in Congress over his push to end some tax breaks for oil companies.

"It's going to be very difficult in most of these countries to get rid of their subsidies," said Alden Meyer, director of strategy and policy for the environmental group Union of Concerned Scientists.

The lobbying group for the U.S. oil industry, the American Petroleum Institute, said Friday that the G-20 agreement presented Washington with a difficult choice.

"The president and Congress should not use this commitment as an excuse to raise energy taxes on American consumers and businesses," group president Jack Gerard said.

G-20 negotiators struggled to claim major progress on another energy- and climate-related initiative: a request from Obama, made at the G-8 summit in July, for finance ministers to begin hammering out the details of an international pool of money to help developing nations adapt to a changing climate and adopt technology to reduce their greenhouse-gas emissions.

The G-20 declaration contains no specifics about such a fund -- a product, observers said, of the reluctance of the U.S., Europe and Japan to make even vague offers about how much money they would be willing to contribute.

Instead, it directs finance ministers to report back at their next meeting "with a range of possible options for climate-change financing" that could be considered in the Copenhagen talks.

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jtankersley@latimes.com

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