Thread: Climate Change and our Land of Fire, Flood and Drought.

Originally Posted by JDNSW

I have yet to see a legitimate explanation of what "fossil fuel subsidies" are. Actually, there is the opposite. Fossil fuels produced in Australia are the subject of special taxes (royalties) and most, if not all, imported fossil fuels are subject to very heavy taxes by the sovereign state in which they are produced, or are produced by a government owned company so that all net revenue is government income, the exact reverse of a subsidy. (Note that there have actually been subsidies on fossil fuel exploration in the past in Australia, in an effort to reduce dependence on imports, and there is general support for coal mining in those states where it generates a lot of state revenue, but the amount of these "subsidies" is far less than the tax income from production.)

In addition, fuels used for transport are subject to a special tax called excise, again, the exact reverse of a subsidy.

In fact, several Australian states and the Federal Government derive substantial revenue directly from fossil fuel production, and reduction or elimination of fossil fuel production would require either a massive reduction in government services or a major increase in taxes from some other source.

As far as I can determine, these alleged "fossil fuel subsidies" are a notional tax that fossil fuels "ought to pay" because of their effect on the environment. This is a rather specious argument, as it is not claimed that other activities which have an environmental impact are also subsidised (e.g. food production, which in many countries actually is subsidised, construction of infrastructure, construction of housing, defence etc).

Note that the fossil fuel industries get various types of assistance that is generally available to other industries, but these pale into insignificance compared to the assistance given over the years to, for example, manufacturing or public transport.

If I am missing something, could somebody explain?

It is one thing to consider that a carbon tax should be imposed (and I would support that in general), but to claim that a subsidy exists because a tax is not imposed is quite simply nonsense, and to claim it is a subsidy without explaining this is deliberately misleading.

Here's one source. However that's not the point of the post.

Tax-based subsidies | Market Forces
Tax-based subsidies | Market Forces
marketforces.org.au

The point is that renewables get a lot less subsidies than fossil fuels. If you want to remove renewable subsidies, then you should also remove fossil fuel subsidies. Or swap the ratio over and see the economy boom.

Yes, don't forget the infrastructure like rail lines and a water supply too.

Originally Posted by bsperka

Here's one source. However that's not the point of the post.

Tax-based subsidies | Market Forces.....

The point is that renewables get a lot less subsidies than fossil fuels. If you want to remove renewable subsidies, then you should also remove fossil fuel subsidies. Or swap the ratio over and see the economy boom.

Not really an indictment of the issue really.
If fossil fuel producers use up 20% of the fuel excise rebate, then the transport sector must use very close to 80% of it(maybe 79%).
Transport can't be really considered 'fossil fuel' producers, and while they definitely emit .. there is zero other options now and in the immediate future.
I can't ever imagine a realistic option other than diesel for transport in Aus, in this or the next generation.

Originally Posted by bsperka

Here's one source. However that's not the point of the post.

Tax-based subsidies | Market Forces
Tax-based subsidies | Market Forces
marketforces.org.au

The point is that renewables get a lot less subsidies than fossil fuels. If you want to remove renewable subsidies, then you should also remove fossil fuel subsidies. Or swap the ratio over and see the economy boom.

I look at that list, and see a list of tax concessions, none of which are specific to fossil fuel industries. The article is so specious that it has to be considered deliberately misleading, especially as it does not mention the specific taxes that are imposed on fossil fuels, except to claim that an exemption from them is a subsidy.

I can see good reasons to reduce the scale of fossil fuel production, especially coal, but pretending that these industries are subsidised to an extent greater than any other industry is not supported by any facts that have been presented. The other side of the coin is that they produce far more government revenue, both directly and indirectly than these tax concessions yield.

The coal industry can't operate without transport for the coal to ports or power stations, so any transport subsidy for it is a fossil fuel subsidy.
Clive Palmer left the Liberals after the Liberal Queensland Government refused to subsidise a rail line to his mine.
The current Qld Govt approved Adani, but says Adani has to stack up without subsidies.

Originally Posted by JDNSW

I look at that list, and see a list of tax concessions, none of which are specific to fossil fuel industries. The article is so specious that it has to be considered deliberately misleading, especially as it does not mention the specific taxes that are imposed on fossil fuels, except to claim that an exemption from them is a subsidy.

I can see good reasons to reduce the scale of fossil fuel production, especially coal, but pretending that these industries are subsidised to an extent greater than any other industry is not supported by any facts that have been presented. The other side of the coin is that they produce far more government revenue, both directly and indirectly than these tax concessions yield.

The thread is about climate change. Fossil fuel subsidies came up as someone wanted to only remove renewable subsidies, rather than having a level playefield where all subsidies were removed. Arguing about the size of fossil fuel subsidies and whether it's really a subsidy wasn't and isn't the point.

Originally Posted by AK83

Not really an indictment of the issue really.
If fossil fuel producers use up 20% of the fuel excise rebate, then the transport sector must use very close to 80% of it(maybe 79%).
Transport can't be really considered 'fossil fuel' producers, and while they definitely emit .. there is zero other options now and in the immediate future.
I can't ever imagine a realistic option other than diesel for transport in Aus, in this or the next generation.

The thread is about climate change. Fossil fuel subsidies came up as someone wanted to only remove renewable subsidies, rather than having a level playefield where all subsidies were removed. Arguing about the size of fossil fuel subsidies and whether it's really a subsidy wasn't and isn't the point.

Australia's hottest day on record forecast for next week, as the heat wave moves from WA to the East.

Australia could see hottest day on record next week as Perth heatwave conditions travel east - ABC News (Australian Broadcasting Corporation)