Go to Top

Fossil Fuel Subsidy Reform

Fossil Fuel Subsidy Reform: A New Zealand Perspective

Following a radical programme of domestic subsidy reform during the 1980s, in recent years New Zealand has taken a lead role advocating for significant reform of the international law and policy framework concerning fossil fuel subsidies.

Subsidies for the exploration, production and use of fossil fuels result in production over-capacity, over-consumption and are a significant economic impediment to the development and implementation of renewable energy sources. They are directly linked with a range of significant adverse global environmental impacts, most notably, climate change. The International Energy Agency considers that elimination of fossil fuel subsidies would result in a reduction in global energy demand equivalent to the entire energy consumption of New Zealand, Japan and Korea combined.

The process of development and implementation of domestic policy and law relating to domestic subsidies (in particular, in the agricultural sector) in New Zealand has been well documented. However to date there has been no in-depth independent review of what might be regarded as a second phase of New Zealand-driven subsidy reform: the application of principles, practices and legal frameworks for domestic subsidy reform (largely focused on agriculture) to international fossil fuels subsidies.

This research project funded by the New Zealand Law Foundation and the AUT University School of Law aims to fill that gap on an issue that the New Zealand Government has identified as a priority in terms of current international environmental policy and law.

The project commenced in February 2013 with a comprehensive literature review, development of a project website and preparation for a series of interviews in Wellington with Government officials, diplomats, academics and NGO representatives in April – June 2013. The international component will take place from a base at the Faculty of Law, University of Cambridge from July – December 2013.