IDEAS home Printed from https://ideas.repec.org/a/taf/tcpoxx/v21y2021i8p1037-1052.html
   My bibliography  Save this article

Phasing out fossil fuel subsidies in the EU? Exploring the role of state aid rules

Author

Listed:
  • Julian Nowag
  • Luis Mundaca
  • Max Åhman

Abstract

The paper aims to identify and analyse potential legal avenues for phasing out fossil fuel subsidies (FFS) in the European Union (EU) using State aid rules. Our analysis reveals that the EU State aid rules would allow the European Commission to effectively target and monitor a vast number of FFS. From a policy perspective, the requirements for notification, examination, transparency, reporting, and recovery of unlawfully granted aid are of particular importance. The legal framework also provides avenues for the EU Commission to start a ‘Fossil Fuel Inquiry’, while providing important tools for civil society to apply pressure on states for the removal of FFS. Based on our legal analysis and pertinent literature, we discuss which of these different FFS and corresponding estimates are likely (or not) to fall under the EU State aid rules. Despite inherent uncertainties, the EU State aid toolbox offers various possibilities to the EU to actively advance its climate change policy and comply with its international commitments to reduce FFS.Key policy insights Member States in the EU still subsidize both the consumption and production of fossil fuels by a myriad of different measures, despite pledges to reduce FFS as part of the EU’s ambitious climate policy.A major part of these fossil fuels subsidies could be addressed by the already existing EU State aid rules, which provide an effective system that is not dependent on Member States political will and has a powerful enforcement mechanism.A first key step would be for the EU Commission to start a ‘Fossil Fuel Inquiry’, which would identify and quantify all support for fossil fuels within Member States.The EU State aid rules could also provide civil society with the possibility to actively lobby for State aid control, while offering the court systems in Member States as an additional avenue for enforcement.With this in mind, the EU State Aid rules could be used effectively to help the EU to phase out a major part of FFS.

Suggested Citation

  • Julian Nowag & Luis Mundaca & Max Åhman, 2021. "Phasing out fossil fuel subsidies in the EU? Exploring the role of state aid rules," Climate Policy, Taylor & Francis Journals, vol. 21(8), pages 1037-1052, September.
    • Handle: RePEc:taf:tcpoxx:v:21:y:2021:i:8:p:1037-1052
    DOI: 10.1080/14693062.2021.1965523
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/14693062.2021.1965523
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/14693062.2021.1965523?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ilaria Perissi & Aled Jones, 2022. "Investigating European Union Decarbonization Strategies: Evaluating the Pathway to Carbon Neutrality by 2050," Sustainability, MDPI, vol. 14(8), pages 1-20, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:tcpoxx:v:21:y:2021:i:8:p:1037-1052. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/tcpo20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.