Innovation Addressing Climate Change Challenges
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Innovation Addressing Climate Change Challenges

Market-Based Perspectives

Edited by Mona Hymel, Larry Kreiser, Janet E. Milne and Hope Ashiabor

Although the world faces many environmental challenges, climate change continues to demand attention. This timely book explores ways in which market-based instruments and complementary policies can help countries meet their climate change goals. The chapters explore carbon pricing and other tax and non-tax measures, offering useful market-based perspectives that can help inform the many climate policy decisions that lie ahead.
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Chapter 7: Cutting Europe’s lifelines to coal subsidies

Shelagh Whitley, Laurie van der Burgh, Leah Worrall and Sejal Patel


Coal subsidies were reviewed in ten countries responsible for 84 per cent of Europe’s energy-related greenhouse gas emissions: France, Czech Republic, Germany, Greece, Italy, Hungary, the Netherlands, Poland, Spain and the UK. Despite commitments on climate change, fossil fuel subsidies and air pollution, all countries provided some form of subsidy to coal, through budgetary support or tax breaks, in 2016. Six countries have introduced new coal subsidies, worth €875 million per year, since the 2015 Paris Climate Agreement. In aggregate, €6.3 billion per year was provided (average for 2005–2016) across a total of 65 coal subsidies identified. Only a minority (€859 million per year) are supporting workers and communities to transition away from coal mining, while subsidies with the stated objective of the energy transition are being directed to coal (€1 billion per year). We recommend that European governments increase transparency and accountability to meet existing subsidy phase-out commitments – and undertake consistent annual reporting.

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