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The report argues that fossil fuel subsidy reform (FFSR) is a critical tool for financing a just transition, as global subsidies total at least USD 425 billion per year. It posits that FFSR can reduce global carbon emissions by roughly 10 per cent by 2050 if both production and consumption subsidies are eliminated. The document outlines a framework for successful reform based on three elements: getting prices right, managing impacts, and building support. Through case studies of Morocco, Mexico, Argentina, Indonesia, and the Netherlands, the report demonstrates that while FFSR can create budgetary space for social safety nets and renewable energy, a lack of stakeholder engagement and abrupt price hikes—as seen in Mexico—can lead to civil unrest. Conversely, the Netherlands' long-term transition of its coal sector illustrates how targeted supports and social dialogue can protect workers during industrial shifts.

The document examines the Dutch coal experience, starting with the state-managed closure of domestic mines in Limburg (1965-1974) driven by the discovery of natural gas and political shifts. It details the social engineering and subsidies used to transition 75,000 workers, noting that while the region eventually diversified, the process was lengthy and marked by economic crises. The study then analyzes the 'return of coal' in the 1970s, where policy shifted toward imported coal to diversify energy security after the oil crises, leading to a lasting reliance on coal-fired power plants. It concludes that current climate targets and court rulings now clash with this path-dependency, creating a risk of stranded assets in modern coal plants.

The report analyses historical coal transitions in the UK, US, Spain, Poland, Czech Republic, and the Netherlands, concluding that proactive anticipation and comprehensive regional strategies are essential to avoid long-term socio-economic decline. It argues that the cost of failing to invest in a managed transition often exceeds the cost of the transition itself, as evidenced by high long-term social security costs and regional stagnation. Key recommendations include moving away from simple cash redundancy payments toward on-the-job retraining, diversifying regional economies through industrial clusters, and addressing the specific vulnerabilities of workers aged 35-45.