Institutional Policy and Economic Impacts of Energy Subsidies Removal in East Asia

Han Phoumin and Shigeru Kimura

in Books from Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract: This study explores the impact of energy subsidies and provides policy recommendations to gradually phase out energy subsidies in the East Asia Summit (EAS) region. Fossil fuel subsidies amounted to about $51 billion in Southeast Asia for 2012 alone (ERIA and IEA, 2013). They encourage wasteful energy use; burden government budgets; defer investment in energy infrastructure and efficient technology; and further undermine renewable energy uptake. While some ASEAN countries have taken action to remove energy subsidies, such action, which is often politically sensitive, must be accompanied by careful strategy and steps. Energy subsidies are important if they are well targeted for people who need energy to survive and to improve their well-being. For example, fossil-fuel subsidies improve the living conditions of the poor by making fuel for cooking and heating more affordable. However, most are often blanket subsidies, which benefit the rich rather than the poor. Blanket energy subsidies incentivise consumption and can result in increased energy demand. However, inefficient subsidies can lead to fiscal pressure, harmful emissions, and potentially undermine sustainable green growth in EAS countries. Reduced energy subsidies will encourage more energy-efficient consumption, leading to a positive impact on international energy prices and energy security, and will make renewable energy and technologies more competitive. It further benefits the environment and society by reducing local pollution and cutting greenhouse gas emissions.

Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.eria.org/RPR_FY2015_23.pdf

Chapters in this book:

Ch 1 A Review of Energy Subsidy Removals and Other Energy Policy Reforms: The Case of Malaysia

Phoumin Han

Ch 2 Economic, Social, and Environmental Impacts of Energy Subsidies: A Case Study of Malaysia

Li Yingzhu, Su Bin and Xunpeng Shi

Ch 3 Impact Analysis of Removing Petroleum Product Subsidies in Thailand

Thitisak Boonpramote

Ch 4 An Intersectoral Assessment of the Impact of Removing Energy Subsidies in China

Lei Zhu and Yuan Li

Ch 5 Socio-economic Impacts of an LPG Subsidy Removal on the Household Sector in India

Sangeeta V. Sharma and Vinod K. Sharma

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:era:eriabk:2015-rpr-23

Access Statistics for this book

More books in Books from Economic Research Institute for ASEAN and East Asia (ERIA) Contact information at EDIRC.
Bibliographic data for series maintained by Ranti Amelia ( this e-mail address is bad, please contact ).