Ebook349 pages4 hours
Implementing Energy Subsidy Reforms
Rating: 0 out of 5 stars
()
About this ebook
Poorly implemented energy subsidies are economically costly to taxpayers and damage the environment. This report aims at providing the emerging lessons form a representative sample of case studies in 20 developing countries that could help policy makers to address implementation challenges, including overcoming political economy and affordability constraints. The sample has selected on the basis of a number of criteria, including the country’s level of development (and consumption), developing country region, energy security and the fuel it subsidies (petroleum fuel, electricity, natural gas). The case studies were supported by data collection related to direct budgetary subsidies, fuel and electricity tariffs, and household survey data.
The analysis provides strong evidence of the success of reforms in reducing the associated fiscal burden. For the sample of countries, the average energy subsidy recorded in the budget was reduced from 1.8% in 2004 to 1.3%GDP in 2010. The reduction of subsidies is particularly remarkable for net energy importers. Pass-through of international fuel prices was also notable in the case of electricity generated by fossil fuel. For the sample of countries, the average end-user electricity tariff increased by 50%, from USD 6 cents in 2002 to USD 9 cents per kWh in 2010.
In spite of the relatively price inelastic demand for gasoline and diesel, fossil fuel consumption in the road sector (per unit of GDP) declined in the 20 countries examined from 53 (44) in 2002 to about 23 kt oil equivalent per million of GDP in 2008 in the case of gasoline (Diesel). The most notable decline in consumption was recorded in the low and lower middle income countries. This reflects the much higher rate of growth in GDP in this group of countries and underlines the opportunities to influence future consumption behavior rather than modifying the existing consumption patterns, overcoming inertia and vested interests. Similar trends are recorded for power consumption.
While there is no one-size-fits-all model for subsidy reform, implementation of compensatory social policies and an effective communication strategy, before the changes are introduced, reduces helped with the implementation of reforms.
The analysis provides strong evidence of the success of reforms in reducing the associated fiscal burden. For the sample of countries, the average energy subsidy recorded in the budget was reduced from 1.8% in 2004 to 1.3%GDP in 2010. The reduction of subsidies is particularly remarkable for net energy importers. Pass-through of international fuel prices was also notable in the case of electricity generated by fossil fuel. For the sample of countries, the average end-user electricity tariff increased by 50%, from USD 6 cents in 2002 to USD 9 cents per kWh in 2010.
In spite of the relatively price inelastic demand for gasoline and diesel, fossil fuel consumption in the road sector (per unit of GDP) declined in the 20 countries examined from 53 (44) in 2002 to about 23 kt oil equivalent per million of GDP in 2008 in the case of gasoline (Diesel). The most notable decline in consumption was recorded in the low and lower middle income countries. This reflects the much higher rate of growth in GDP in this group of countries and underlines the opportunities to influence future consumption behavior rather than modifying the existing consumption patterns, overcoming inertia and vested interests. Similar trends are recorded for power consumption.
While there is no one-size-fits-all model for subsidy reform, implementation of compensatory social policies and an effective communication strategy, before the changes are introduced, reduces helped with the implementation of reforms.
Read more from Maria Vagliasindi
Revisiting Public-Private Partnerships in the Power Sector Rating: 0 out of 5 stars0 ratingsThe Design and Sustainability of Renewable Energy Incentives Rating: 0 out of 5 stars0 ratingsPower Market Structure: Revisiting Policy Options Rating: 0 out of 5 stars0 ratings
Related to Implementing Energy Subsidy Reforms
Related ebooks
Beyond Crisis: The Financial Performance of India's Power Sector Rating: 0 out of 5 stars0 ratingsBeyond Crisis Rating: 0 out of 5 stars0 ratingsExploring a Low-Carbon Development Path for Vietnam Rating: 0 out of 5 stars0 ratingsLow-Carbon Development Rating: 0 out of 5 stars0 ratingsLow-Carbon Development: Opportunities for Nigeria Rating: 0 out of 5 stars0 ratingsChina's Energy Policy from National and International Perspectives: The Energy Revolution and One Belt One Road Initiative Rating: 0 out of 5 stars0 ratingsThe Power of the Mine: A Transformative Opportunity for Sub-Saharan Africa Rating: 0 out of 5 stars0 ratingsThe Power of the Mine Rating: 0 out of 5 stars0 ratingsReshaping Global Value Chains in Light of COVID-19: Implications for Trade and Poverty Reduction in Developing Countries Rating: 0 out of 5 stars0 ratingsReview of the ADB Clean Energy Program Rating: 0 out of 5 stars0 ratingsThe Trade and Climate Change Nexus: The Urgency and Opportunities for Developing Countries Rating: 5 out of 5 stars5/5Power for All Rating: 0 out of 5 stars0 ratingsUnlocking Commercial Financing for Clean Energy in East Asia Rating: 0 out of 5 stars0 ratingsDeployment of Hybrid Renewable Energy Systems in Minigrids Rating: 0 out of 5 stars0 ratingsGuidance Note: Electricity Sector Risk Assessment Rating: 0 out of 5 stars0 ratingsTajikistan's Winter Energy Crisis: Electricity Supply and Demand Alternatives Rating: 0 out of 5 stars0 ratings
Power Resources For You
The Way Home: Tales from a life without technology Rating: 4 out of 5 stars4/5The Boy Who Harnessed the Wind: Creating Currents of Electricity and Hope Rating: 4 out of 5 stars4/5Energy: A Beginner's Guide Rating: 4 out of 5 stars4/5Electronics All-in-One For Dummies Rating: 4 out of 5 stars4/5The Grid: The Fraying Wires Between Americans and Our Energy Future Rating: 4 out of 5 stars4/5Idaho Falls: The Untold Story of America's First Nuclear Accident Rating: 4 out of 5 stars4/5How to Drive a Nuclear Reactor Rating: 0 out of 5 stars0 ratingsDIY Lithium Battery Rating: 3 out of 5 stars3/5The Homeowner's DIY Guide to Electrical Wiring Rating: 5 out of 5 stars5/5Emergency Preparedness and Off-Grid Communication Rating: 0 out of 5 stars0 ratingsStation Blackout: Inside the Fukushima Nuclear Disaster and Recovery Rating: 0 out of 5 stars0 ratingsPower Supply Projects: A Collection of Innovative and Practical Design Projects Rating: 3 out of 5 stars3/5The Ultimate Solar Power Design Guide Less Theory More Practice Rating: 4 out of 5 stars4/5Solar Power Demystified: The Beginners Guide To Solar Power, Energy Independence And Lower Bills Rating: 5 out of 5 stars5/5Geo Power: Stay Warm, Keep Cool and Save Money with Geothermal Heating & Cooling Rating: 5 out of 5 stars5/5Photovoltaic Design and Installation For Dummies Rating: 5 out of 5 stars5/5How Do Electric Motors Work? Physics Books for Kids | Children's Physics Books Rating: 0 out of 5 stars0 ratingsSolar Electricity Basics: Powering Your Home or Office with Solar Energy Rating: 5 out of 5 stars5/5Electric Motor Control: DC, AC, and BLDC Motors Rating: 5 out of 5 stars5/5The Illustrated Tesla (Rediscovered Books): With linked Table of Contents Rating: 5 out of 5 stars5/5The Rare Metals War: the dark side of clean energy and digital technologies Rating: 5 out of 5 stars5/5Reservoir Exploration and Appraisal Rating: 0 out of 5 stars0 ratingsThorium Fuel Cycle: Building nuclear reactors without uranium fuel Rating: 0 out of 5 stars0 ratingsSolar Power: How to Construct (and Use) the 45W Harbor Freight Solar Kit Rating: 5 out of 5 stars5/5Oil: A Beginner's Guide Rating: 4 out of 5 stars4/5Solar Power Your Home For Dummies Rating: 4 out of 5 stars4/5Do It Yourself: A Handbook For Changing Our World Rating: 3 out of 5 stars3/5Energy: A Human History Rating: 4 out of 5 stars4/5Off Grid And Mobile Solar Power For Everyone: Your Smart Solar Guide Rating: 0 out of 5 stars0 ratingsElectric Motors and Drives: Fundamentals, Types and Applications Rating: 5 out of 5 stars5/5
Reviews for Implementing Energy Subsidy Reforms
Rating: 0 out of 5 stars
0 ratings
0 ratings0 reviews