PDF《G20 subsidies to oil, gas》

G20 subsidies to oil, gas and coal production: United Kingdom Sam Pickard and Laurie van der Burg priceofoil.

org odi.org Country Study November

2015 Argentina Australia Brazil Canada China France Germany India Indonesia Italy Japan Korea (Republic of) Mexico Russia Saudi Arabia South Africa Turkey United Kingdom United States For the purposes of this country study, production subsidies for fossil fuels include: national subsidies, investment by state-owned enterprises, and public finance. A brief outline of the methodology can be found in this country summary. The full report provides a more detailed discussion of the methodology used for the country studies and sets out the technical and transparency issues linked to the identification of G20 subsidies to oil, gas and coal production. The authors welcome feedback on both this country study and the full report to improve the accuracy and transparency of information on G20 government support to fossil fuel production. This country study is a background paper for the report Empty promises: G20 subsidies to oil, gas and coal production by Oil Change International (OCI) and the Overseas Development Institute (ODI). It builds on research completed for an earlier report The fossil fuel bailout: G20 subsidies to oil, gas and coal exploration, published in 2014. A Data Sheet with data sources and further information for the United Kingdom'

s production subsidies is available at: http://www.odi.org/publications/10085-g20-subsidies-oil-gas-coal-production-united-kingdom Background The United Kingdom (UK) is the largest producer of oil and the second largest producer of gas in the European Union (EU), but offshore production is declining as accessible oil and gas runs out in fields across the North Sea (EIA, 2014). The industry lobby group reports that the UK Continental Shelf (UKCS) is one of the most expensive offshore basins in the world;

however, more than two thirds of North Sea fields reportedly remain profitable at oil prices of $50 a barrel (Economist, 2015;

Oil and Gas UK, 2015). As a result of the decrease in domestic production, in

2013 the UK'

s net energy imports reached their highest level since the 1970s (EIA, 2014). This decline, changes in global energy prices and an increase in tax deductions means that the government forecasts its oil and gas revenues to drop from $3.5 billion in

2014 (from $17 billion in 2011/12) to about $791 million from 2016. This projected revenue is less than 0.05% of GDP and would be the lowest government tax revenue from oil and gas relative to GDP since 1975/76 (HM Government, 2015b;

Office for Budget Responsibility, 2015b). Both coal production and consumption in the UK have significantly declined in recent decades,?with production reaching an all-time low of

13 million tonnes in

2013 (DECC, 2014a) and the last two deep coal mines set to close in

2015 following a government-aided wind-down (Press Association, 2015). A number of surface opencast mines are still in production, and a number of applications for new mines are ongoing with one developer noting that one of the driving forces behind their project is the UK'

s '

excellent fiscal regime and low corporate taxes and royalties'

(NAE, 2015). The UK power sector remains heavily reliant on fossil fuels with coal and gas together used for 60% of electricity generation in

2014 (DECC, 2015a). Alongside seeking to increase the proportion of energy from renewables and nuclear generation, the UK has recently formed a capacity market for its future electricity sector and is investing in carbon capture and storage (CCS) to help achieve its