OECD Companion to the Inventory of Support Measures for Fossil Fuels 2015

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This publication is concerned with all policies that directly support the production or consumption of fossil fuels in OECD countries and in a selection of partner economies. It provides a useful complement to the online OECD database that identifies and estimates direct budgetary transfers and tax expenditures benefitting fossil fuels, and from which it derives summary results and indicators on support to fossil fuels, as well as policy recommendations.

This report emphasises the problems that fossil-fuel subsidies cause in the context of broader policy efforts for mitigating greenhouse-gas emissions, and reviews the various reform initiatives that have already been taken at the international level (G-20, APEC, etc.). In addition, it presents the coverage, method and data sources used for constructing the online database, and further discusses caveats and data interpretation.

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The case for measuring support for fossil fuels

The discussion in this first chapter sets the stage for better understanding the present report and the associated database. To do this, Section 1.1 looks at the reasons why fossil-fuel subsidies are generally considered to be harmful for the economy and the environment. Section 1.2 then shows how this helps explain the recent emergence of a consensus for reforming fossil-fuel subsidies, and how this growing consensus has led to a number of policy initiatives internationally and domestically. Section 1.3 then concludes by placing the OECD Inventory onto that broader stage, emphasising the important role it plays in ongoing discussions of energy policies and their reform.

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