Fossil Fuel Subsidies

This dataset measures the extent to which fossil fuel prices paid by consumers are below their full financial and social costs. This is expressed as an aggregate value for each type of fuel and each economy. Undercharging for fuels is disaggregated into explicit and implicit subsidies. Explicit subsidies measure the amount that the financial cost to supply a fuel (i.e., the supply cost) exceeds the price paid by the fuel user. Implicit subsidies measure the difference between a fuel’s full social cost and the price paid by the fuel user, exclusive of any explicit subsidy. A fuel’s full social cost includes both supply costs and negative externalities, which are costs imposed on society due to consuming the fuel and primarily include local air pollution, climate change, and broader externalities related to driving. It should be noted that the concept of “subsidies” used here differs from the definition of subsidies in macroeconomic statistics.