Seizing the opportunity: tackling fossil fuel subsidies under the UNFCCC

Abstract

Analyses from international and nongovernmental organizations have pointed to the negative environmental, economic and social implications of the sizable subsidies handed out by governments for the production and consumption of fossil fuels. Given their relevance for achieving climate policy objectives, it is perhaps surprising that the climate regime established by the United Nations Framework Convention on Climate Change (UNFCCC) does not address fossil fuel subsidies. This article discusses the possible role of the UNFCCC in tackling fossil fuel subsidies. It suggests that the UNFCCC could enhance the transparency around fossil fuel subsidies and put in place incentives for countries to undertake subsidy reform. However, the possibilites under the UNFCCC will be limited by political barriers to subsidy reform at the national level and will need to be carried out in coordination with other international institutions active in the field.