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Fossil-Fuel Subsidies in the EU’s Eastern Partner Countries

Estimates and Recent Policy Developments

image of Fossil-Fuel Subsidies in the EU’s Eastern Partner Countries

Based on the OECD standard methodology, the study presents quantitative estimates of government support to consumers and producers of coal, oil and related petroleum products and natural gas, and electricity and heat generated from these fossil fuels. This report summarises the main findings of the analysis of fossil-fuel subsidy schemes in the six European Union's Eastern Partner (EaP) countries – Armenia, Azerbaijan, Belarus, Georgia, Republic of Moldova and Ukraine. The study updates the 2018 Inventory of Energy Subsidies in the EU’s Eastern Partnership Countries by providing data and estimates for 2016‑19. The analysis focuses on measuring two major types of fossil-fuel subsidies: direct transfers of funds to producers and consumers; and tax expenditure. This report also briefly discusses the taxation and energy pricing policies that have had direct or indirect impact on the evolution of fossil-fuel subsidies in the region. Detailed estimates of all individual support measures for each of the six countries are provided in Annexes to the report.

English Also available in: Russian

OECD Fossil-Fuel support database

When first launched, the OECD Inventory of Support Measures for Fossil Fuels was organised following the OECD’s Producer Support Estimate The Producer Support Estimate (PSE) indicator measures the annual value of transfers from consumers and taxpayers to producers of fossil fuels.– Consumer Support Estimate Consumer Support Estimate (CSE) reflects the value of transfers to consumers of fossil fuels regardless of their nature, objectives or impacts on consumption.(PSE-CSE) framework. Under this framework, measures providing benefits to fossil-fuel producers are classified under PSE, while those that provide benefits to individual fossil-fuel consumers fall under CSE. A third category, the General Services Support Estimate General Support Services Estimates (GSSE) represents the value of transfers arising from policy measures that create enabling conditions for the fossil-fuel sector. These conditions are created through the development of private or public services, institutions and infrastructure regardless of their objectives and impact on fossil-fuel production and/or consumption. GSSE includes policies where fossil fuels are the main beneficiaries but does not include any payments to individual producers. GSSE transfers do not directly alter producer receipts or costs, or consumption expenditure, although they may affect production or consumption of fossil fuels in the long term.(GSSE), is assigned to measures that do not increase production or consumption of fossil fuels at present but may do so in the future.

English Also available in: Russian

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