Environmentalists Are (Half) Right About Energy Subsidies
Sometimes progressive environmentalists have a point. For instance, they argue that oil subsidies are wasteful and should be abolished. Unfortunately, they typically pollute their sound arguments with gross inconsistency and unwarranted alarmism.
Oil Change International, a group of mainstream progressive environmental pressure organizations, has published two recent papers complaining that the G20 governments, through international and national development banks, continue to finance fossil-fuel projects around the world, with insufficient subsidies for “clean energy,” defined as renewables not including hydro and some others.
The group explains the rationale for its prescription as follows: “The best available science shows an urgent need to keep global temperature increases below 1.5°C to avoid severe disruptions to people and ecosystems.”
This anti-oil coalition is absolutely correct that subsidized finance for fossil-fuel projects is highly wasteful. It is one thing to subsidize fossil fuel development as a step in economic development, to alleviate acute poverty in developing countries. But where this is not the case, the financing of highly profitable commercial undertakings such as fuel production should be the job of the