Joint UNEP and UNECE Expert Meeting
on Energy Subsidies

Geneva, 15-16 November 2007

The objective of the meeting was to take stock of past and ongoing work in this area, identify gaps in both analytical and process terms, and consider collective efforts to move the agenda forward.

Energy subsidies often fail to meet their intended objectives. Moreover, they create market imperfections or fail to meet social objectives, such as supporting the most vulnerable groups in society. While it is difficult to quantify the costs and benefits of subsidisation, subsidies have been shown to keep energy prices below economic levels, contribute to environmental degradation and to an inappropriate depletion of natural resources. Removing subsidies, once in place, is difficult, particularly in countries where social safety nets are weak or non-existent.

UNEP started working on the impacts of energy subsidies 8 years ago. Some of the activities were carried out in collaboration with the International Energy Agency (IEA). The lessons learned and the recommendations from these activities resulted in two publications.

Similarly, UNECE commenced work on reforming energy subsidies in 2002. The UNECE Committees on Sustainable Energy and on Environmental Policy jointly developed non-legally binding guidelines for decision-makers on reforming energy prices and subsidies to support sustainable energy development. The guidelines were endorsed by the fifth Ministerial Conference “Environment for Europe ”, Kiev, Ukraine, 21-23 May 2003.

Now with climate change and energy security at the centre of the international agenda, there are opportunities for moving the work on energy subsidies forward. However, before taking further steps it would be useful to reflect on past experiences and devise a more targeted and sustained approach to reforming energy subsidies.

The expert meeting provided a platform for like-minded institutions and individuals to share past experiences and ongoing work. The meeting was also expected to discuss how we could collectively identify the main issues, potential solutions, and way forward in a manner that attracts the attention of policymakers.

For more information on UNEP ETB's work on energy subsidies, please visit: http://www.unep.ch/etb/areas/energySub.php

Contact: fulai.sheng@unep.ch