A new report by UNEP, the United Nations Environment Program, says that getting rid of the subsidies on climate change causing fossil fuels would not just play an important role in combating global warming and other associated forms of air pollution but also help to revive the fast ailing global economy.

Currently these energy subsidies account for 0.7 percent of the world’s gross domestic product, and the majority of that amount – which might only sound like a small percentage but is around $300 billion US Dollars – is used to support the market for completely unsustainable and climate change causing fuel supplies like gas and coal. With countries failing to meet their targets for curbing, let alone actually reducing their emissions rate, it is unclear whether the UN’s analysts and statisticians were really needed to suggest that, actually, artificially lowering the price of unsustainable fuels might be beneficial for the environment, even if it does send the suited and booted city dogs and Stetson tipping black gold prospectors into jitterbugging shock.

This new report balances the economic against the environmental. It calculates that removing them would reduce global CO2 levels by six percent a year. Because the money saved could be placed into other projects, such as sustainable development, sustainable energy and research projects. The UNEP reports reckons that this 6 percent drop in carbon emissions would be met with a 0.1 percent rise to global GDP.

Many people currently argue that by scrapping these subsidies the poor would be adversely effected. However, this report found that the true beneficiaries of global energy subsidies in their current form are not the poor at all, but actually the well off. Adam Steiner, UN Under-Secretary General and the Executive Director of UNEP describes says that ‘many fossil fuel subsidies are introduced for political reasons...[and] are simply propping up and perpetuating inefficiencies in the global economy – they are thus part of the market failure that is climate change.”

"There are now less than 500 days before the crucial climate change convention meeting in Copenhagen in late 2009. Governments should urgently review their energy subsidies and begin phasing out the harmful ones that contribute to the wasteful use of finite resources and delay the introduction of renewables or more efficient forms of generation while creating disincentives and barriers to public transport up to energy saving appliances,"

Despite the fact that the need for renewable energy is becoming a focus for many media, governmental and NGO groups, the report shows that the battle between action and inaction on the issue of climate change is effectively one of environment against short-term economic return. By arguing that these subsidies are actually contributing to the malaise that is weakening the global economy right now, UNEP have taken the debate to the door of the fat cats.

Whilst the cynics and sceptics argue that the removal of subsidies will affect the  poorest first, the fact is that climate change is already affecting the most vulnerable regions of the world, where crop failures, flooding and disease are not easily to counteract through the infrastructures that we, in the West, often take for granted.

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