Prometheus Misinterpreted: Why Government Still Subsidises Fossil Fuels

Contrast the scientific advisories with what governments have done in response: The advisory has been that only 4 years of carbon budget now remain if warming is to be limited to +1.5 degrees. Deep and rapid cuts in emissions are needed to avert critical risks to life on Earth. (The political response was acceptance, with various undertakings, starting from 2009 at G20, to phase out subsidies for fossil fuels...)

But, in fact, subsidies for fossil fuels have increased. Even in the wealthy EU, they rose slightly in the period 2015-2021, doubled in 2022 and have not since been retired to pre-invasion levels. Truly, this is government as Prometheus, meddling with nature, wilfully accelerating instead of retarding global warming, even playing with fire; but without the Titan’s scientific insight - his flames were of course responsible for the rise of civilisation.

It should be remembered that +1.5 would be the greatest warming the planet has seen in the past 10,000 years with, even at this by now ‘low’ end of the scale, gigantic human and economic cost.

Why then do governments continue to subsidise the prices of the largest contributor to warming? Because subsidies are addictive: Once given, they are politically difficult to withdraw. And because there are limits to what our political processes can achieve at the necessary tempo: It’s not difficult to imagine why – in 2022 - the emergency doubling of subsidies post-invasion wasn’t entangled with a deal simultaneously to withdraw the pre-existing measures. The trouble is those measures have proved equally immovable over time, even if failure to budge them has put the executive branch (and humanity) on a collision course with nature.

Take aviation, a major emitter, copiously doused in government subsidies - to include, in the EU for example, an exemption from tax on jet kerosene and VAT on tickets. These originate ideologically from the 1940s when flying had special connotations of friendship between nations, and climate change wasn’t a consideration; but have found new resonance in the era of budget airlines, despite looming climate disaster. They have been difficult to reform given the requirement for unanimity on fiscal legislation and the alacritous lobbying of the industry. But the cost of failure is a lethal price signalling: Someone driving from London to Edinburgh pays 5.5 times more tax than someone flying the same journey. And, most egregiously, emissions from aviation are mainly contributed by the wealthier but at least equally sumped by those who cannot afford to fly: A study in 2020 showed that on average North Americans flew 50 times further than Africans.

Morally wrong, perhaps, but are fossil-fuel subsidies unlawful? We think so. They will certainly tend to be at the intersection of the constitutional preserves of the three branches where it is evident that they will inevitably increase emissions. It is well known that the global community including the EU is not on track to meet climate targets and as these are recurrently missed, and planetary survival becomes an increasing focal point for the courts, government will be given a narrower margin of appreciation to determine that subsidising fossil should remain acceptable. New subsidies or subsidised projects of this kind will become increasingly difficult to justify. Existing subsidies will need to be phased out if they are inconsistent with, for example, the settled legal obligation of all ECHR member states to put in place a legislative and administrative framework with respect to climate change designed to provide effective protection of human health and life, and a further positive obligation to apply that framework effectively in practice, and in a timely manner.

And government’s argument that it cannot tax fossil because it is prevented by treaty, for example with respect to jet kerosene, will come undone. Even in the EU it is perfectly open to Member States to introduce a ticket tax without breaching the Energy Tax Directive restriction on taxing jet kerosene: That may not be the most carbon-effective tax on the industry or be politically popular, but it is lawful. The ETD itself makes it lawful to excise kerosene on flights to another Member State by bilateral agreement with that state. The EU’s treaty with the UK expressly permits the taxation of aviation fuel. Many bilateral Air Service Agreements do likewise or permit tax in that they provide for the exemption from excise on the basis of reciprocity. There are lawful ways to tax aviation.

Can the Courts Stop Climate Change?

Can the Courts Stop Climate Change?

No, but they can play an important role: By reminding politicians that, once laws are made, even government must adhere to them.

There are many laws of this kind, often resulting from the Paris Agreement, sometimes establishing binding targets for governments to reduce emissions. The courts have been reluctant to interfere with decisions on precisely how and when to execute: That's the constitutional preserve of government. But there may be increased judicial activism if targets evidently lack clarity, ambition or attainability; or, perhaps, there is unacceptable execution against them. And environmental law is reaching increasingly into diverse areas such as planning, company and contract law.

Last April, the European Court of Human Rights decided that Switzerland had violated the European Convention by failing to act acceptably against warming. An association of senior women successfully argued that their health was unlawfully threatened by worsening heat waves. This is expected to trigger similar claims elsewhere.

Business is also increasingly susceptible to climate litigation. Last November a Dutch appellate court decided that Shell had a legal duty to curb warming. The plaintiffs had requested - and been granted by a lower court - an order requiring Shell to reduce its CO2 emissions by 45% by 2030 compared to 2010 levels, and to zero by 2050, in line with the Paris Agreement. Actions against non-fossil fuel corporates, grounded for example on greenwashing, are becoming more common.

This is not to over-state the impact of litigation. Many climate cases have failed, sometimes with punitive costs orders against the plaintiff NGOs. Even successful actions have delivered questionable reductions in actual emissions: When Ireland's Supreme Court quashed the government's mitigation plan the hard-fought remedy was a requirement to produce a new plan. And the constitutional role of courts is more to react, by overturning incompatible administrative acts or laws, than proactively to drive the comprehensive programme of legislative reform that is needed.

Still, although parliaments will remain the most important arenas in the battle for climate security, the courts will at minimum provide vital accountability and a counter-weight to lobbying. Litigation and legal activism will prove more potent than protest, civil disobedience and, as the political will to take on warming weakens globally, policy advocacy.

The best available global tracker, maintained by the Sabin Center at Columbia Law School, counts, on a fairly narrow definition of "climate litigation", almost 3,000 cases to date. The caseload will likely increase substantially during Trump's second term.