If we are to have a likely chance to achieve the 1.5C goal, we need to phase out all fossil fuels. However, fossil fuel subsidies are a major obstacle to full decarbonisation and despite the enormous threat climate change poses, countries keep subsidizing fossil fuels. The International Monetary Fund estimated that energy subsidies totalled US$5.3 trillion in 2015, or 6.5 percent of the global Gross Domestic Product. Eliminating subsidies would cut emissions of carbon dioxide, the main greenhouse gas, by more than 20 per cent a year, according to the IMF. Another benefit would be to reallocate government revenue, (ie savings from eliminating the subsidies) to invest in health care, renewable energy, mass transit and other public services.
The International Energy Agency (IEA) has established an on-line database to increase the availability and transparency of energy subsidy data as an essential step in building momentum for global fossil-fuel subsidy reform. The issue has been under consideration by the G-20 (the world´s 20 largest economies) since 2008 but there has been little action so far.