Search Climate Insights Directory

India's energy system is heavily reliant on fossil fuels, which provided 75% of its total energy supply in 2017. The state derives significant revenue from this sector—17.8% of general government revenue in 2017—but also provides substantial subsidies. While India has set ambitious renewable energy targets, including 450 GW, coal is projected to remain a mainstay of the energy mix through 2040. The government faces risks from stranded assets, with approximately 40 GW of coal-fired power plant capacity identified as "non-performing" as of 2018.

The document details Russia's high reliance on fossil fuels, which accounted for 90% of its total energy supply in 2017 and 23.6% of general government revenue. It highlights the dominance of state-owned enterprises like Gazprom and Rosneft, the government's strategy to expand exports to the Asia-Pacific region, and the significant fiscal gap created by the under-taxation of fossil fuel consumption. The report also examines various forms of production and consumption subsidies, as well as the role of the National Welfare Fund in managing windfall revenues.

The document analyzes South Africa's heavy reliance on coal, which provided 89% of its electricity in 2017. It details the fiscal impact of this dependence, noting that while fossil fuel production revenues are modest, consumption taxes—primarily the fuel levy—contribute significantly to government revenue. The report also highlights the role of state-owned enterprises like Eskom and PetroSA, the risks of asset stranding, and the government's commitment to a 'just transition' and carbon taxation despite political flux in energy policy.

Brazil's economy is influenced by significant fossil fuel reserves, particularly 'pre-salt' oil, though it is the least dependent on fossil fuels among BRICS nations due to biofuels and hydropower. In 2017, fossil fuel revenues accounted for 6.8% of general government revenue, while subsidies represented 0.3% of GDP. The government continues to seek increased oil and gas production despite climate commitments to reduce greenhouse gas emissions by 43% by 2030. Fiscal complexities include high state-level VAT on fuels, significant tax exemptions for production, and the earmarking of royalties for health and education.

The document analyzes China's heavy reliance on fossil fuels, particularly coal, and the fiscal implications of this dependence. It details the structure of government revenues from fossil fuels, the influence of state-owned enterprises, and the prevalence of subsidies. While China has implemented policies to reduce coal overcapacity and peak emissions by 2030, it continues to provide significant subsidies and finance fossil fuel projects internationally through the Belt and Road Initiative.

This executive summary by the Climate Policy Initiative analyzes the economic transition of the Berau District in East Kalimantan, Indonesia, from a coal-dependent economy to one based on palm oil. The study finds that shifting from coal to a palm oil mono-crop is unsustainable and risks food security. It recommends a transition plan focusing on RSPO certification, increasing production efficiency, diversifying into other high-value crops like pepper and cocoa, and developing downstream processing refineries to capture added value and increase government revenue.

The report analyzes the economic fragility of Berau, East Kalimantan, caused by its heavy reliance on coal mining, which contributes over 60% of its GRDP. While the district is shifting toward palm oil, the study warns that mono-cropping palm oil risks replicating the same commodity-dependency trap. It recommends a transition plan based on increasing productivity and efficiency over land expansion, diversifying into high-value crops like pepper and cocoa, and developing downstream processing refineries to capture added value. Additionally, the report suggests optimizing government revenue through 'Own-Source Revenue' and implementing innovative ecological fiscal transfer mechanisms to reward sustainable land management.

The document analyzes the fiscal dynamics of fossil fuels in Mexico, noting a decline in extraction revenues and an increase in consumption revenues. It argues for a cost-benefit analysis of continued fossil fuel reliance versus renewable alternatives and calls for increased transparency in hydrocarbon and coal revenues. The report warns against regressive generalized subsidies and highlights the tension between the administration of Andrés Manuel López Obrador's goal to increase oil extraction for energy security and the resulting environmental and social challenges.

The report analyzes the economic fragility of Berau Regency due to its heavy reliance on coal mining and the risks of replacing it with a palm oil monoculture. It argues for a multi-dimensional transition focusing on palm oil productivity efficiency over expansion, diversification into high-value crops like pepper and cocoa, and the development of downstream processing industries. The document also proposes optimizing local government revenue and implementing innovative ecological fiscal transfer mechanisms to incentivize sustainable land management.

The document analyzes Mexico's fiscal dependence on fossil fuels amidst declining reserves and production. It highlights a shift where revenues from fuel consumption (IEPS and IVA) are becoming more significant than extraction revenues. The report warns against 'stranded assets' resulting from continued investment in fossil fuel infrastructure and recommends redirecting regressive subsidies toward clean energy and vulnerable populations to support a just energy transition.

The report analyzes Indonesia's fiscal shift from fossil fuel dependence, noting a significant drop in upstream oil and gas revenues from 35% of total revenues in 2001 to 6% in 2016. It argues that current fuel and electricity subsidies are inefficient and that the government underutilizes the fiscal space available through energy consumption taxes compared to other BRIICS countries. The document advocates for investing subsidy savings and fossil fuel taxes into social development, economic diversification, and renewable energy.

The report analyzes Indonesia's shift from a high fiscal reliance on oil and gas revenues to a more diversified economy. It highlights a critical imbalance where government revenues from fossil fuel production are largely offset by inefficient consumption subsidies that disproportionately benefit wealthy households. The document warns of the risk of stranded assets valued between USD 200–300 billion and argues for phasing out fossil fuel subsidies to create fiscal space for renewable energy and social development.

Indonesia has successfully reduced its fiscal reliance on oil and gas production, but continues to struggle with inefficient fossil fuel subsidies that benefit wealthy households and hinder the growth of renewable energy. While the government has diversified its economy into manufacturing and finance, contradictory policies—such as maintaining price caps on fuels and prioritizing coal for electrification—create risks of stranded assets and environmental degradation. The report argues for the complete removal of fossil fuel subsidies, the implementation of consumption-based energy taxes, and the strategic investment of resource rents into social safety nets and renewable energy infrastructure to ensure a just transition.

The report analyzes the governance and utilization of Indonesia's Village Fund, finding that while the fund has grown significantly and is a major revenue source for villages, it is predominantly spent on transportation infrastructure. The authors identify five key challenges—including a lack of technical capacity, misaligned planning between village and district levels, and insufficient regulatory guidelines—that hinder the fund's potential to support environmental conservation and sustainable land use. To address these, the report recommends integrating village priorities into district planning, empowering the Village and Community Empowerment Office, creating specific sustainability guidelines, adopting a 'negative-list' for spending, and introducing a sustainability variable into the fund's allocation formula.

The report highlights the potential for a 'triple win' through fossil fuel subsidy reform (FFSR) and increased fuel taxation, which could reduce global carbon dioxide emissions by 23% and raise government revenue equivalent to 2.6% of GDP. It notes that global fossil fuel subsidies are approximately USD 425 billion annually and provides examples of India and Indonesia saving USD 15 billion each in 2015 through FFSR. The text links these fiscal instruments to the Paris Agreement and Sustainable Development Goals 7, 12, and 17.

The document details the Indonesian government's management of energy subsidies across LPG, electricity, and liquid fuels, noting a trend of increasing budget allocations due to delayed reforms and external price pressures. It highlights the transition to targeted subsidies using poverty databases and smart cards, the implementation of the 'One Price Policy' to ensure fuel affordability in remote areas, and the long-term financial implications of capacity payments for coal-fired power plants.

The document examines how multinational mining companies use debt financing to shift profits out of host countries and proposes a combination of the OECD BEPS Action 4 framework and other fiscal measures to protect the tax base in developing nations.

The report finds that Indonesia's current tax system does not incentivize sustainable land use in the palm oil industry, characterized by low tax-to-GDP ratios and minimal revenue redistribution to local governments. It proposes six fiscal reforms, including increasing land taxes and tying revenue sharing to sustainability indicators, to reduce deforestation and improve land productivity.

The report examines the distribution of centrally financed fuel subsidies in India, highlighting a significant disparity where Bihar, one of the poorest states, consistently receives the lowest per capita transfers for diesel, LPG, and kerosene compared to wealthier states like Haryana, Delhi, and Gujarat.

The research paper examines the fiscal pressures facing South Africa, highlighting high government debt, sluggish economic growth, and rising public sector costs. It details specific budget allocations for infrastructure and energy, including the Renewable Energy Independent Power Producer Programme and nuclear procurement, while framing these economic realities against the backdrop of student demands for tertiary education funding.