UNTOLD BILLIONS: FOSSIL-FUEL SUBSIDIES, THEIR IMPACTS AND THE PATH TO REFORM

This executive summary, published by the International Institute for Sustainable Development (IISD) in April 2010, synthesizes five research papers on the economic, environmental, and political dimensions of fossil-fuel subsidies. It argues that these subsidies lock economies into fossil-fuel reliance, increase greenhouse gas emissions, and divert funds from social services. The document provides a framework for reform, emphasizing the need for transparency, political strategy, and a two-track approach involving both domestic reporting and a new international data-gathering regime.

• Fossil-fuel subsidies create significant negative externalities by locking economies into long-term fossil-fuel reliance, increasing greenhouse gas emissions through the support of inefficient energy use, and contributing to land degradation and environmental pollution. Furthermore, these subsidies often fail to reach the poor, instead benefiting "higher income groups, fossil-fuel companies and equipment makers."
• Analysis of six major multi-country studies indicates that reforming fossil-fuel subsidies would lead to aggregate GDP increases in both OECD and non-OECD countries, with predictions ranging from 0.1 per cent by 2010 to 0.7 per cent per year to 2050. Environmentally, such reforms are predicted to reduce CO2 emissions by between 1.1 per cent by 2010 and 18 per cent by 2050, though these figures are likely under-predictions because they rely on the conservative "price-gap approach."
• The persistence of subsidies is driven by political logic rather than just economic demand. Subsidies are used by governments as a low-administrative-cost tool to ensure political survival, influence voting, and prevent population unrest. Because they are highly visible, consumer subsidies are more common, while producer subsidies are often more covert.
• Successful subsidy reform requires a comprehensive strategy consisting of six elements: early research to quantify costs and benefits; clear articulation of reform objectives; a coherent policy including complementary welfare support for the poor; careful implementation; continuous monitoring and adjustment; and the use of independent bodies to prevent political backsliding.
• A critical barrier to reform is the lack of accurate data. The document proposes a two-track transparency approach: first, improving domestic accounting and reporting using consistent international standards; and second, establishing a new international regime to gather data via standard reporting templates and guidelines, potentially managed by an intergovernmental organization.
• Pilot studies on producer subsidies reveal diverse data gaps: China lacks disaggregated information and has hundreds of special tax exemptions; Germany's tax expenditure reporting is outdated and municipal data is inconsistent; Indonesia lacks transparency in royalties and production-sharing contracts; and the United States reports federal tax expenditures as multi-industry aggregates, making sector-specific attribution difficult.

APA

International Institute for Sustainable Development (2010). UNTOLD BILLIONS: FOSSIL-FUEL SUBSIDIES, THEIR IMPACTS AND THE PATH TO REFORM. https://www.iisd.org/gsi/sites/default/files/synthesis_ffs.pdf

Chicago

International Institute for Sustainable Development. UNTOLD BILLIONS: FOSSIL-FUEL SUBSIDIES, THEIR IMPACTS AND THE PATH TO REFORM. 2010. https://www.iisd.org/gsi/sites/default/files/synthesis_ffs.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=UNTOLD BILLIONS: FOSSIL-FUEL SUBSIDIES, THEIR IMPACTS AND THE PATH TO REFORM |date=April 2010 |url=https://www.iisd.org/gsi/sites/default/files/synthesis_ffs.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopment2010untold, author = {{International Institute for Sustainable Development}}, title = {{UNTOLD BILLIONS: FOSSIL-FUEL SUBSIDIES, THEIR IMPACTS AND THE PATH TO REFORM}}, institution = {International Institute for Sustainable Development}, year = {2010}, month = apr, url = {https://www.iisd.org/gsi/sites/default/files/synthesis_ffs.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }