The report can be read here

The report, prepared by Tara Laan and Adilson de Oliveira, examines the rationale used by Brazilian governments to justify consumer fossil fuel subsidies and the interest groups which benefitted from them. Government policy during the 1980s, prior to the eventual liberalization of energy markets during the 1990s, involved complex cross subsidization between energy sectors. The Brazilian experience is useful for understanding the rationale for subsidies in countries with large regional and social disparities. Changes in subsidy policy often produced an uneven economic and social impact on different regions of Brazil and Brazilian society, depending on wealth and access to alternative energy sources. The main lessons learned from liberalizing Brazil's energy market focuses on government attempts to address the rationale used by interest groups to continue the use of existing fossil fuel subsidies.

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An overview of the entire series

'The Effects of Fossil-Fuel Subsidy Reform:Review of modelling & empirical studies'

Contributed by Kerryn Lang at

This is the 2nd paper to be published in the series 'Untold Billions: Fossil-fuel subsidies, their impacts and the path to reform'.

Subsidies are powerful instruments and when granted to fossil fuels, which are at the heart of all modern economies, subsidies have impacts throughout the economy, society and environment. Understanding the complex trade-offs between the different impacts of subsidy reform is a challenge for any government considering phasing out fossil-fuel subsidies.

In this report, Jennifer Ellis provides a detailed literature review, focusing on the six modeling studies in the last 20 years that have attempted to analyze global impacts of subsidies for all fuels. The studies mostly considered effects on greenhouse gas emissions and gross domestic product, but very little of the work has considered other environmental impacts or social impacts. The paper highlights a number of areas where further research should be undertaken but concludes that there is already enough evidence to demonstrate the significant environmental and economic benefits of phasing out fossil-fuel subsidies, and recommends that policy-makers do not delay in beginning the reform process.

As part of the 'Untold Billions' series, support for the paper "Gaining traction: the importance of transparency in accelerating the reform of fossil-fuel subsidies"* *was generously provided by the United Nations Environment Program (UNEP).

See an overview below of the entire series which consists of a synthesis paper and 5 reports:
  1. The Effects of Fossil-Fuel Subsidy Reform
  1. The Politics of Fossil-Fuel Subsidies
  2. Strategies for Reforming Fossil-Fuel Subsidies
  1. Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies
  2. Mapping the Characteristics of Fossil-Fuel Subsidies (to be released soon).

Further information

Ms. Kerryn Lang
Research Officer,
Global Subsidies Initiative,
International Institute for Sustainable Development (IISD)
klang at or +41.22.917.8920


The Global Subsidies Initiative (GSI) is pleased to announce the publication of Tara Laan's paper. "Gaining Traction: The importance of transparency in accelerating the reform of fossil-fuel subsidies" This paper is published as part of the series Untold Billions: Fossil-fuel subsidies, their impacts and the path to reform.

Transparency is the cornerstone of holding governments accountable for the ways in which they spend public money. As governments increasingly recognize that subsidizing fossil fuels undermines climate change, energy security and sustainable development objectives, good data and analysis will be vital for prioritising reform efforts and monitoring their effectiveness. This paper addresses the role that increased transparency could play in fossil-fuel subsidy reform and specifically asks what information and mechanisms are needed to support the G-20 and APEC calls for reform?

As part of her analysis, Tara Laan considers the role of many of the inter-governmental and non-governmental organizations that currently contribute to the field and discusses options for developing a collaborative and comprehensive international system for evaluating and reporting fossil-fuel subsidies. The paper concludes that two track approach is necessary: Domestic action to improve accounting and reporting, and international action to develop a new data gathering and management regime.

This paper would not have been possible without the support and financial assistance of the United Nations Environment Programme's Economics and Trade Branch.