New research from Bloomberg New Energy Finance reveals that governments of the world are spending substantially more on subsidizing dirty forms of energy than on renewables and biofuels. In all Bloomberg New Energy Finance says governments of the world provided approximately $43 to $46 billion to renewable energy and biofuels technologies, projects and companies in 2009. This figure stands in stark contrast to the $557 billion spent on subsidizing fossil fuels in 2008 as estimated by the International Energy Agency last month.
The BNEF preliminary analysis suggests the United States is the top country as measured in dollars deployed in providing direct subsidies for clean energy with an estimated $18.2 billion spent in total in 2009. Approximately 40% of this went toward supporting the U.S. biofuels sector with the rest going towards renewables.
The BNEF report says the gap between what governments spend on subsidizing fossil fuels and clean energy should narrow considerably in 2010 for two reasons. First support for renewables and biofuels will grow as disbursement of $188 billion in global stimulus funds for clean energy accelerates. Second the amount governments such as China spend to keep fossil fuel prices artificially low for consumers has dropped as oil prices retreated from their mid-2008 peaks. Simply put, less government support is needed to make these dirty sources of energy more affordable to populations around the globe.
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