Greenpeace activists  bring attention to a well-known but not always acknowledged fact. Photo: Greenpeace Polska/ BY-ND

Huge benefits from ending subsidies to fossil fuel

Fossil fuel subsidies support an industry that causes premature deaths and ill-health worldwide – the health costs associated with fossil fuel use are more than sixfold the subsidies.

Despite the fact that burning fossil fuels causes deadly air pollution and climate change, governments spend huge amounts of taxpayers’ money on supporting the oil, gas and coal industry.

Back in 2009, the G20 group of major economies committed to phasing out fossil fuel subsidies, but failed to set a deadline. A new study by the Health and Environment Alliance (HEAL) now reveals that on average, in G20 countries, the health costs associated with emissions from fossil fuels are over six times higher than the subsidies. In 2014, the figures were €2,600 billion vs €416 billion.

In the preface of the report, Dr Gro Harlem Brundtland concludes that: “The true cost of fossil fuel powered energy remains hidden by artificially low prices that do not take into account the environmental and health costs these fuels cause. All of us pay twice for fossil fuel subsidies – once when scarce public funds are used to subsidise fossil fuel energy and secondly when society deals with the health costs associated with burning fossil fuels. Ultimately fossil fuel subsidies pay the polluter instead of making the polluter pay.”

Air pollution from mostly fossil fuel combustion contributes to the premature deaths of an estimated 6.5 million people worldwide every year because of respiratory tract infections, strokes, heart attacks, lung cancer and chronic lung disease. The resulting health costs are not carried by the industry but paid by society.

The report examines the costs of the health impacts that arise from fossil fuel subsidies in a number of selected countries: China, Germany, India, Poland, South Africa, Turkey and the UK, as these are seven economically powerful countries which continue to subsidise fossil fuels, despite all of them suffering high costs from air pollution. For example, in Germany a quarter of premature deaths caused by air pollution could be prevented if fossil fuel subsidies were eliminated and corrective taxes implemented. That figure rises to 41 per cent in the UK, 51 per cent in Poland and 74 per cent in Turkey.

In China, fossil fuels cause a staggering 1,790 billion USD in health costs from air pollution, more than 18 times what the nation hands out to oil, gas and coal producers, helping to fuel a public health crisis that is already causing 1.6 million premature deaths every year.

HEAL calls on policy-makers to phase out fossil fuel subsidies at the latest by 2020 for developed nations and by 2025 for low-income economies, to decrease premature deaths, poor health and climate chaos, and pave the way for renewable, clean energy choices and their multiple health benefits.

The organisation also provides recommendations as to how the funds could be re-allocated to boost health in the report’s seven spotlighted countries. For example, in Germany, the €5.1 billion of fossil fuel subsidies represent taxpayer money that is sufficient to provide more than 300,000 households with a solar installation, powering their homes with clean energy, as well as to fund the transition for all of Germany’s 15,000 coal power plant workers for the coming five years. In countries such as Turkey and Poland, fossil fuel subsidies represent valuable public funds that could greatly strengthen the countries’ health systems.

Genon K. Jensen, HEAL’s Executive Director said: “European and global leaders continue to pledge to tackle climate change and decarbonise our economy. However, they still give out billions of euros and dollars which lead to global warming and fuel early death and ill-health including heart and lung disease. It is time to seize the opportunity to improve the health of millions of people worldwide by abandoning subsidies to the deadly fossil fuel industry. They should walk the talk and end fossil fuel subsidies now.”

Christer Ågren

The report: “Hidden price tags: How ending fossil fuel subsidies would benefit our health.”


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