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Energy subsidies report shows progress in 2023

The Commission has published the 2024 Report on Energy Subsidies in the EU detailing the volume of public subsidies by national governments across the EU in 2023. 

Required under the EU Governance Regulation and in the context of international commitments on phasing out fossil fuel subsidies by 2030, the report confirms that energy subsidies were stable until 2021, increased dramatically in 2022 during the energy crisis, and then moderately decreased in 2023. Total energy subsidies in the EU jumped from €213 billion in 2021 to €397 billion in 2022 and decreased by 10% to €354 billion in 2023 – equivalent to 2.10% of GDP, down from 2.37% in 2022. Energy subsidies linked to national crisis measures to protect EU consumers from the high prices accounted for an estimated €145 billion in 2023 (down from €187 billion in 2022). Across the EU, at least 270 national measures were created to address the energy price crisis. Households were the main direct beneficiaries of these crisis measures (receiving €121 billion in 2021-2023), followed by industry and the transport sector (€30 billion and €28 billion, respectively, over the same period). Cross-sectoral support to all energy consumers reached €125 billion in the same period. For fossil fuels, subsidies amounted to €111 billion, 18% down from 2022’s record levels.

The report concludes that the EU and EU countries need to do more to phase out all fossil fuel subsidies by 2030. It underlines that there is a need for more transparency. In response to the relatively high share of fossil fuel subsidies, it highlights the need to level the playing field between technologies and incentivise clean technology uptake instead of supporting [fossil fuel] technology lock-in. It also stresses the importance of creating and reinforcing momentum to reduce subsidies for the most polluting fuels at international level. 

In the new Commission College, Wopke Hoekstra, Commissioner for Climate, Net Zero and Clean Growth, is tasked with, jointly with Dan Jørgensen, Commissioner for Energy and Housing, developing a roadmap to ‘further scale down and phase out the use of fossil fuel subsidies, including in the context of the next Multiannual Financial Framework’. 

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