Even as global governments raise their ambitions to cut fossil fuels in the future, they spent a record $1 trillion last year subsidizing energy sources that are the main driver of climate change.
“The Glasgow Climate Pact emphasized that phasing out fossil fuel subsidies is a fundamental step toward a successful clean energy transition,” the IEA said in its report. “However, today’s global energy crisis has also underscored some of the political challenges of doing so.”
The subsidies helped shield consumers from soaring energy prices as many economies were still recovering from the impact of the pandemic. As Russia cut supplies of natural gas following its invasion of Ukraine last year, the European Union spent $349 billion to reduce consumer energy bills.