Increasing the Momentum of Fossil-Fuel Subsidy Reform

The report investigates the feasibility of using the WTO, UNFCCC, and G-20 as homes for international fossil-fuel subsidy reform. It argues that while the WTO has the legal tools and the UNFCCC has the climate mandate, neither is currently politically viable for a binding agreement. Instead, it proposes a multi-forum approach led by the G-20's political momentum, moving from short-term coordination of research and monitoring toward a long-term negotiated agreement.

• Fossil-fuel subsidies impose massive global costs, with consumer subsidies estimated at US$400 billion per year and producer subsidies adding at least another $100 billion.
• Removing energy consumption subsidies in the 20 largest developing countries over ten years could reduce global greenhouse gas emissions by at least 10 per cent by 2050.
• The WTO's Agreement on Subsidies and Countervailing Measures (SCM) is limited by low reporting rates and a lack of sanctions for non-compliance, making the transparency system fragile.
• The UNFCCC is unlikely to host legally binding subsidy reform in the medium term due to its strong adherence to national sovereignty and the political complexities of the post-Copenhagen architecture.
• The G-20 provides essential political leadership but lacks a formal secretariat, necessitating the delegation of technical tasks to other international organizations.
• The report proposes a three-stage roadmap: the next 12 months focusing on strengthening political leadership and coordinating research; 1-3 years for embedding reform in national policies and building a negotiating mandate; and the longer term aiming for a formally negotiated agreement.
• A multi-forum approach is considered the most realistic path forward, combining the research of IGOs (like the IEA and OECD), the financial support of IFIs (World Bank and IMF), and the monitoring capabilities of NGOs.

APA

Lang, K., Wooders, P., & Kulovesi, K. (2010). Increasing the Momentum of Fossil-Fuel Subsidy Reform. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/increasing_momentum.pdf

Chicago

Lang, Kerryn, Peter Wooders, and Kati Kulovesi. Increasing the Momentum of Fossil-Fuel Subsidy Reform. International Institute for Sustainable Development, 2010. https://www.iisd.org/system/files/publications/increasing_momentum.pdf.

Wikipedia

{{cite report |last1=Lang |first1=Kerryn |last2=Wooders |first2=Peter |last3=Kulovesi |first3=Kati |title=Increasing the Momentum of Fossil-Fuel Subsidy Reform |publisher=International Institute for Sustainable Development |date=June 2010 |url=https://www.iisd.org/system/files/publications/increasing_momentum.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{lang2010increasing, author = {Lang, Kerryn and Wooders, Peter and Kulovesi, Kati}, title = {{Increasing the Momentum of Fossil-Fuel Subsidy Reform}}, institution = {International Institute for Sustainable Development}, year = {2010}, month = jun, url = {https://www.iisd.org/system/files/publications/increasing_momentum.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }