Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies

The report examines the critical role of transparency in reforming fossil-fuel subsidies, particularly in the context of 2009 commitments by the G-20 and APEC. It identifies a significant gap in available data, noting that current estimates often rely on a 'price-gap' approach that overlooks producer subsidies. The author proposes a two-track approach to improve transparency: enhancing domestic accounting and reporting standards within countries, and establishing a new international data-gathering regime. This international regime would ideally involve a standard reporting template, standardized methodologies, and the potential leadership of intergovernmental organizations like the IMF or World Bank to ensure global buy-in and consistency.

• The G-20 and APEC leaders committed in late 2009 to phase out inefficient fossil-fuel subsidies, but the success of this initiative depends on increasing the quality and quantity of information on those subsidies.
• Existing international data on fossil-fuel subsidies is limited and often relies on the 'price-gap' approach, which only captures subsidies that lower the final price for consumers and ignores producer-side support.
• A lack of transparency is often caused by governments not knowing the full extent of subsidies in their jurisdiction due to fragmented data across ministries and the high resource cost of calculating non-budgetary support.
• Transparency supports reform by institutionalizing public discourse, exposing the winners and losers of subsidies to broaden support for change, and reducing opportunities for corruption.
• The report recommends a two-track approach to transparency: improving domestic reporting through consistent accounting standards and creating a new international regime for data management.
• For an international transparency regime to be effective, it requires a standard reporting template, a clear scope of included support, and 'buy-in' from national governments who see the benefit of disclosure.
• While the IEA has experience with consumer subsidies, its limited membership may hinder a worldwide effort; the IMF or World Bank are suggested as better coordinators due to their universal membership.
• The report suggests that reporting compliance for developing countries could be incentivized by linking it to funding for climate-change mitigation efforts under the UNFCCC Copenhagen Accord.

APA

Laan, T. (2010). Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies. International Institute for Sustainable Development. https://www.iisd.org/gsi/sites/default/files/transparency_ffs.pdf

Chicago

Laan, Tara. Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies. International Institute for Sustainable Development, 2010. https://www.iisd.org/gsi/sites/default/files/transparency_ffs.pdf.

Wikipedia

{{cite report |last1=Laan |first1=Tara |title=Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies |publisher=International Institute for Sustainable Development |date=April 2010 |url=https://www.iisd.org/gsi/sites/default/files/transparency_ffs.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{laan2010gaining, author = {Laan, Tara}, title = {{Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies}}, institution = {International Institute for Sustainable Development}, year = {2010}, month = apr, url = {https://www.iisd.org/gsi/sites/default/files/transparency_ffs.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }