in the session but at least three countries that are going to be discussed in the different presentations are all major co-producers. So I think what we saw already in the previous session is that in the discussion of fossil fuel subsidies and reform it's actually quite important to make a careful distinction between the types of fossil fuels that we're actually talking about. And I think this session will show that there's actually a good reason to do so. There may be a good reason for example because of the impacts on climate change, not every fossil fuel is as dirty as the other one. And with coal is often very very much singled out as one of the dirtiest fossil fuels. But it might also be important from the perspective of political economy and understanding the politics of fossil fuel subsidies and their reform. And I think from reading the paper, I think reading the papers you already get a bit of a perspective in that and a bit of insight. So for example if you look at Claudia's paper on Columbia you see that coal is actually very much seen as one of the mining, as part of the mining sector. So not necessarily as a fossil fuel. And similarly if you look at Jesse's paper you can see obviously coal being one of the major sources of energy in South Africa makes the whole discussion very different for other fossil fuels. So I'm not going to have a very long introduction like Laura, but Laura did set a wonderful president of how to chair the session. So like her, I am going to be strict with the time limits.  But so basically each of you has 10 minutes for the presentation. And then Iveta has up to 15 minutes to discuss and provide some cross-cutting suggestions and observations on the basis of the three papers. So we'll start with Jesse Burton who is presenting on behalf also for colleagues at Tony Lott and Brita Rancum from the University of Cape Town. And she will look at fossil fuel subsidies in South Africa. Then we'll move on to Claudia Stambo who is also presenting on behalf of colleagues in the back of the room, Erin Atherich and colleagues in Columbia that she's been working with recently. And then finally we have Richard Dennis who's been in the discussions about Australian coal and Australian fossil fuel subsidies for a very long time. And he'll provide some very interesting insights from the Australian perspective. So we'll start with you, Jesse, you have about 10 minutes. This is why I keep it very short, I'm a nice guy. I'm Jesse Burton from the Energy Research Centre at UCT. Thanks to Jakob and her for having me and for such an interesting conference. I also want to say I'm very new to the subsidies world, so please be kind if I've got a definition wrong, which I think is going to be a big issue later Richard tells me. So South Africa is really interesting, we're an incredibly carbon-tinted economy. I'm going to talk a little bit about the history because our entire energy system is basically rooted in the late 1960s and that's where all the support for coal was sort of birthed. And it's not always a subsidy, sometimes it's support, depending on your definition. And sometimes it's not a subsidy for production at all, it's for consumption, but it's still locked in the system. But also what's happened is that there's been a formalization over time of informal rules that were negotiated during apartheid that have remained. And not always about coal mining, often around Sassel, who's our coal to liquids producer, they produce petrol and diesel from coal. Highly carbon intensive, highly energy intensive. And getting around that is not really about fossil fuel subsidies, it's about liquid fuels regulation. So we have regulated electricity prices as well, regulated liquid fuel prices, and the state is heavily involved in the energy sector more broadly. We have centralized energy planning in South Africa that assumes one that there'll be growth in coal fired power going forward and that there'll be no reduction in coal to liquids. And there's very little feedback between what is happening in the market and that planning process. So even though fossil fuel subsidies have made fossil fuels cheaper over time, renewable energy is now cheaper in South Africa than anything else. New builds, electricity, utility scale renewables are cheaper, and that isn't fed back into energy planning at all. At the same time, the economic costs of the transition is the primary argument against mitigation, and this is within government itself. There's conflict around this, and outside of government. We also have energy security problems in our electricity sector at the moment, and potentially in thermal coal supply. So energy security narratives have been historically important, especially on sassel and liquid fuels. But those are ongoing, and they remain. And despite, we do have quite a lot of mitigation policy. We've got a renewable energy program. We've got a carbon tax bill, which has been delayed several times, and we have carbon budgets at the firm level. But a lot of that has been delayed or put off over time. And in none of that mitigation policy is fossil fuel subsidies ever mentioned. There's nothing on the supply side. So where did the structure of the South African energy sector come from? Well, we have 92% of our electricity come from coal, and this is based in the late 60s, early 1970s. Escom, our utility, partly the coal contracts were politically motivated. So there was this drive in the 70s to create new capitalists, Africana capitalists. And they used Escom coal contracts to build new mining houses. To do that, Escom provided the capital for those mines, and it continues to hold the liabilities on those mines. They're called cost plus mines. So they pay a fee to miners on top of the cost of mining. Now, those were for mines that don't have export grade product. For mines that do have export grade product, and can be what we call multi-product, Escom didn't put up the capital. But what Escom did was guaranteed very low coal prices. So I guess a consumption subsidy from those mines. And the way that that very low price was guaranteed was via export allocations which were controlled by the state. So the state would allocate tranches of exports to different companies. If you wanted that export tranche, you had to guarantee a low domestic supply in general and a low Escom supply in particular. However, the state also supported those export multi-product mines by building the railways and by building the port. The coal export terminal is privately owned. And in the same way, water infrastructure has been developed by the state over time. And I don't think it's possible to quantify this kind of support. I just don't think that the numbers exist, but it would be very interesting to. We had thought we might, but we didn't. And what's interesting also is that empowerment agenda from the 1970s has persisted, so today Escom is contracting with potentially non-competitive coal suppliers or high-cost coal suppliers because they're black-owned mines and there's a big industrial policy push around that. So they have their own internal quota of 50% plus one black-owned mines, all that they'll contract with. And that's not in line with any other kind of legislation. That's coal, the coal electricity nexus. The coal liquid fuels nexus happens via Sassel. In the 1950s, South Africa took some technology called the Fisher-Trops process and built Sassel One, which is a coal-to-liquid plant. And it was a very small contribution to the liquid fuels demanded supply, it wasn't that important. But it did get tariff protection and what they term upliftment, which is where all the other oil companies had to buy oil of Sassel's product at import parity prices and include it. What happened after the 1970 oil price spikes and because of sanctions is that in the late 1970s, Sassel was expanded into Sassel two and three. That's the Secunda plant there you can see. That now supplies 30% of our liquid fuels. Now what happened is that it was originally a state-owned company. It was then privatized and when it was privatized, the central energy fund who owned it lent the buyer. They gave them a loan to buy Sassel. And the loan interest rates were dependent on ongoing tariff protection. So in the early 90s, when they load tariff protection for Sassel, they also load interest rates and that was paid by the state. The other thing that was important is that upliftment carried on and the liquid fuels refiners had to multiple the whole of their capacity to absorb Sassel's product. And that was paid by a levy from motorists. The third part of this, I mean it goes on and on and on, the subsidies of different forms, is that Sassel was protected by the state if oil prices were below $16 a barrel between, oh no, 23 apologies. Then from $23 to $28 a barrel, they just made money. Above $28 per barrel, they were meant to put their windfall profits into an equalization fund. However, in the 90s when they decided to change the system or they tried to change the regulations, it turned out there was no mechanism by which the state could appropriate that windfall tax and so they never paid it. They just accumulated it. It was about four billion rand in 1995 rand. So the liquid fuels system is interesting. It's import parity pricing for the entire sector. So there's an import parity price and then a series of costs are built on the top of that related to transport and a whole lot of other things. So in fact, even just the liquid fuels refiners are getting protection. But Sassel benefits disproportionately from this because their cost structure has got no relationship to liquid fuels refining at all. And they cost on an energy basis about half. It costs half per unit of energy for their production as it does a liquid fuels refiner. So when oil prices are high, they make a lot more money out of that. And I'm going to talk a little bit later about that because that's a transfer from consumers to Sassel. I would think of that as a subsidy. I'm not sure how we calculate it though. OK, so what did we do? I think support or skewing the market is the best definition because in South Africa that's what applies. Often you can't quantify things like transit building railways. Transit continues to build railways. There's a state owned rail organization. Whether those rates are commercial or not is unknown, although they've said that they're not in some cases. But you have no data on any of these things. And we obviously think it's really important to include things like transfer from consumers to producers because then it includes Sassel. Our numbers don't include a whole lot of things, partly because there's no data and partly because we couldn't figure out how to calculate them. So for example, mineral royalty rates, the coal royalty rates. The IMF has reported that the effective tax rate has been below what it can be in the legislation, but I'm not sure why. I can't figure out even from the authors of that study why. Obviously, expiration tax breaks, which ODI had put in their paper, you can't quantify. There's some public finance that we know exists, but we can't quantify it. So the Government Employee Pension Fund is governed by something called the Public Investment Corporation and they invest in coal mining and they invest, they are investing in a coal power producer, but they've got a 50 billion round sort of flash fund and they don't report what any of those investments are. So we don't know how much it is or what it's worth. But we think it would be interesting to find out. And there is pressure in South Africa to expose, to get more information on some of these investments. What we did do is we took what ODI had done, which was great. I think it must be one of the only pieces of public work on this. And we just went a little bit further back in time. So we've got some bigger numbers than them and I'll go into a bit more detail. But direct transfers, you can see it ranges from about five billion round to 23 billion round in some years. Now, a billion round probably doesn't mean very much to any of you. Our government budget is 900 billion round a year. Our GDP is about three trillion. So that gives you a sense of scale. Government revenue foregone is not enormous at three billion round. It's usually related to tax rebates on diesel use, which got very large in recent years because Escom gets a rebate. Public finance is to build liquid fuels fired power plants. And then I've put sassel rents in there, which I'll talk a little bit more about later. So direct or potential transfers. I mean, there are series here. I won't go through them all. Some are loans to Escom. Some are interest foregone. Some are direct transfers to Escom, which we've included based on the ODI inclusion. Transit pipeline. That was pointed out by ODI, but they didn't have numbers. That was for a multi-product pipeline to move crude around. And that was a direct transfer from the state to transnet. Petro say, oh my god, two minutes. Petro say, SIFS and EDE, they've got funding by the state for CCS, oil and gas promotion and various things. So it's not all coal. A lot of it is around the good fuels. But MQAP done at the bottom, that's water infrastructure for coal mining. And so is Lepelale. I won't talk about the others except Sassles. So these are Sassles operating profits for the years that we can get data from the investor handbooks from. This is just for sin fuels. It's not their entire business. Now, I'm not sure how to calculate this more accurately. Our feedback would be amazing.  It's very large. I would like to put 2015 there because of lower oil prices, but they've changed the way they report. So you can't extract the sin fuels data anymore. But they're making a lot of money in most of these years because of a regulated price, which is built on international fuel prices. But they're making this via coal. And they've been very strongly opposed to the carbon tax because it would eat into their costs. There's the regulated price. It would eat into that. I'm not sure what we're going to do about that. So why has there been no reform? So these are my hypotheses. I still would like to talk to some more people in Treasury. But partly, I think it's because subsidies are really hidden from view, and there's a lot of secrecy. South Africa historically had a lot of secrecy also. During apartheid, people would shake hands to make deals. There was nothing written down. Subsidies are not on the policy agenda really at all in the domestic climate space. The scale and extent are not very well known. And then a lot of the support is not framed as a subsidy. So if you were to include Sassel, for example, to call that a subsidy would potentially, I think, be a very powerful tool because it isn't seen that way. Some people consider it rent. A lot of people don't even consider it rent. They think they're an innovative chemicals company, but they're not, I would argue. I'm aware that they might watch this. They're also very different policy communities. So we're now just trying to figure out mineral rates around coal, for example. And I asked Treasury about this. The guy just struck, he's like, what do you mean fossil fuel subsidies? They're not seen as this. And I don't know potentially if there's engagement within Treasury in South Africa around that. But there are a whole lot of experts who are working on different things that are not thinking about this as subsidies. And on another hand, there's not a lot of alliance between the mitigation community. So Department of Environmental Affairs does carbon price, or they don't do carbon pricing, but they do regulation. Parts of Treasury do carbon pricing. They're not connected to the other parts of renewable energy policy or climate activists. And at the same time, a lot of those subsidies are coming through other government departments. So water infrastructures, the Department of Water Affairs, ESCOM do coal contracting decisions via the Department of Public Enterprises. So they have control over that. It's got nothing to do with Treasury. They're all in different places in the state, so it matters what those parts of the state are and what they believe about climate or not climate or economic efficiency. I think Treasury care about economic efficiency. I'm not sure that a lot of other parts of the state think about it in that way. Of course, narratives are important. Energy security, sassel seen as key to energy security, for example, coal mining is seen as key to energy security. But I would also say that liquid fuels pricing is the most obvious example of powerful and incumbent interests. So every now and again, deregulation comes onto the policy agenda and it's always squashed usually because there's this narrative that there'd be a lot of unemployment if we deregulated the liquid fuels price. But also it benefits all the liquid fuels refiners and it benefits sassel and they're very well-organized lobbyists. Thank you. How challenging it can be, not only to talk about the politics but purely getting the numbers in the country, right? Next up, we have Claudia S. Lambeau from SCI here in Stockholm, home team in a way. She'll talk about Colombia. All right, good afternoon everyone. So after learning a lot about what's going on in South Africa, we're gonna look at another important coal producing country. A big difference though is that in Colombia, there is very little domestic consumption of coal and most of it is exported. Just give a few elements of context. So it's one of the top exporters of coal globally. The country extracted about 85 million tons last year, 95% of which was exported. The coal industry represents about 1.3% of the GDP growth and about, sorry, about the GDP and about 5% of the country exports. And here I'd like to precise that I'm looking at the large scale coal sector which is open pit geographically concentrated in the north of the country because there are some differences in incentives and political and economical dynamics between big mining and small mining. So from here on, I'm gonna be talking about large scale mining which is very much predominant in Colombia. So this is for the economics, for the political context like in South Africa with the minerals, energy complex and many other countries. We have political aliens between the national governments and the coal extraction companies. We were talking about incumbent actors this morning so we have our incumbent actors here. And to explore some of the key political dynamics that explain the introduction, the shaping and the maintenance of subsidies to coal extraction in Colombia, we use a concept of subsidies regime to call extraction. Here the idea is that it's a dominant arrangement of actors, resources, formally informal rules that support the provision of subsidies to a specific sector. This is quite obviously very much inspired from the literature and socio-technical transition and energy transition in general. So that situates us before going into the politics I'll just talk about a few subsidies that we could find. So I also very new to that. This is part of a broader study on the role of coal extraction in Colombia and the feasibility of supply mitigation measure. That is part of the SEI initiative on fossil development and climate change mitigation. So some of the ones that can be found in the literature although there is almost nothing available on the topic, there are mostly two Colombian authors that have been working not on subsidies as such but about the government take and about broader incentive structure to mining in general. So that's where we can find some of this information. So some of the subsidies, the big one is that coal companies, also other mining companies are able to deduct the amount they pay in royalties from their taxes on incomes which is quite huge. So just for Northern ID in 2013 which is the only year where we have quite precise data because of the AT report. Taxes on income for the three biggest coal companies were about less than half of the royalties. So it's really big. Then we have other types of subsidies. We have the state providing security services in the form of providing escort backing, designing security protocols. At the German people now extraction site, dynamic stocks are managed by an army battalion. So they have their own little army we sent within the mine and companies appear to be contributing to part of this cost but not all of them. Then like in other places too, coal companies have been able to take advantage of regulatory loopholes to use transfer prices. So they sell in harbor to sister companies at a lower price than the international price and that way their profit declared within Columbia is lower and then that reduces their taxes on their income. Then we have also an exemption from local taxes that's a provision that was put in the mining code in 2001 and the implication of that is that municipalities and departments are not able of capturing rent through other means than whatever the royalty distribution allocation system allows them to get. And then some other fiscal incentives such as an exemption from import taxes and tariffs on imported machinery and inputs. That's an interesting one. It was actually established in 1959 within the industrialization per substitution of importation economic model. So it was mainly targeting the manufacturer sector. The idea was that if you export at least for the same value then you can import inputs, raw materials, technology without taxes or tariffs and coal actually is now the main, it's about one third and the first product that is exported through this regime. And then we also have exemption from special taxes on oil products. That's also an interesting one. It's a temporary measure that was established in 2001. So I've been temporary for a while now. It was meant to support local economy in the bordering area between Columbia and Venezuela during a time of economic crisis and it has been maintained and modified through successive decrease. And the result is that now some of the final consumers who is mostly benefiting from it is actually large coal operation companies. So there are a few important points here. Most of the subsidies are not only for coal but for mining in general. But the role of coal within the mining industry is prevalent, I mean more than half of the sector's contribution to GDP and more than 75% of the sector's royalties. And also many of these subsidies were established during the beginning of the 2000s. Although a few of them, such as the Plan Vallejo which is this one, where our leftovers legacies from even older economic development models. So this is for like having a little taste of what we have there. And now we're looking at the politics. Well the question is that, so there is not really a debate on subsidies as such in Colombia. There is quite a strong debate about the government take since the 2011, 2012. These measures that allow company to dedict their royalties was contested in the Congress. There were several initiatives to try to get rid of that but still they're there. They haven't been eliminated. And well the question is why are they so resilient? So here we look at the brother subsidies regime and try to understand some of the key formal infomerules and power dynamics that shape and help maintaining these subsidies. And for doing so we rely only to do about politics of energy and low carbon transition. We look at three different ways how actors can use, increment actors can use power to shape these subsidies and maintain them. And these are discursive forms of power. So it's about shaping debates. Institutional forms of power. So that's about the broader political culture and governance structures. And instrumental forms of power which is about how increment actors use resources such as position of authority, money, access to media in immediate interactions with other actors in order to achieve their goals and interests. So for discusses dynamics. Like the stronger point is that, well like in many other places, coal together with other fossil fuel resources and minerals has a key role within the development narrative. That starts from very far away in history. It's something common within Latin America but there is a revival, really strong revival with Alvaro Ribé's presidency starting in 2002. So that's also the time when a lot of the subsidy were put in place. So a role in fueling economic development for the coal sector and the broader extractive and mining sector. This continued with the Santos government. Here the metaphor used was locomotive of development and the idea was that incentives because we don't talk about subsidies in Colombia. Incentive are justified to attract foreign direct investment and being more competitive than the neighbors. But at the same time there has been increasing opposition to mining activity across Colombia, quite big crisis of legitimacy in public opinion and in the second mandate of President Santos the metaphor of the locomotive was abandoned and now the new role attributed to the mining sector in general. Mining and hydrocarbon sector is to fund the peace building process. So that's quite a shift. And well as you must have figured out by now one other key discursive element that contributes to the strengths of this regime is that coal is packaged together with other minerals and hydrocarbon and that kind of levels out its actual contribution to economic development, to jobs, to royalties and the perception is that it's actually higher than what it is. So that's for the discursive one. How many minutes? Okay. So for the institutional dynamic there is a legacy of internal conflict and weak state. So here in short revenues from natural resources extraction including coal are seen as key to fund the effort of their national government in increase state legitimacy through social programs but also include build the state through control of territory. So that's linked to defense spending. And this week institutionality has contributed to low level of controls of coal mining activities and corruption and lack of capacity which all contributes to make operation more easy for these companies and also the taking advantage of regulatory loopholes also easier. So that's for the institutional one. Another one is fragmentation of political parties and lack of programmatic discipline. So you have the candidates from presidential to municipal and departmental level that are co-opted by through financing of campaigns. And for the instrumental dynamics where we have the first one which is quite obvious which is lobbying. So here it's a long tradition in Columbia but some reform in rules of the game in Congress representation have made it even easier. There is also a new dynamic of all mining companies getting together in a one unique business association a few years ago to increase their lobbying power but at the same time actually this is affecting the interest of coal companies because by being together they get affected by issues that are more specific to other types of mining such as illegal mining in gold extraction which is a huge issue in Columbia. So it might not end up as beneficial as hoped. Okay, I'm doing that super fast I promise. So you might not know, you might know but there is a big structural fiscal reform coming up in Columbia. It's planned for the end of this year. There is a huge deficit partly linked to the change in international economic conditions and we talked a bit about that with some key actors in Columbia and we're surprised that it didn't seem to look such a threat to the coal companies. Yeah, it's a good opportunity to get better incentive to be capable of dealing with the situation. So in that sense it seems that even if that could represent an opportunity to reform some of the subsidies that are tax fiscal based in practice it looks like they're quite confident that they have enough power to shape it in a way that will be in their advantage. There are some also policy makers statement, key policy maker statement that go in the same direction. So we'll see what happens. In Columbia we don't talk about fossil fuel subsidies. In South Africa we don't talk about fossil fuel subsidies. So now Richard will tell us whether in Australia anyone talks about fossil fuel subsidies. Let me try and find a website for you. This one? Yeah. What's the first rule of first rule? Fight club, you know. We don't talk about fossil fuel subsidies. So my name is Richard Dennis. Thank you again to Harrow and Jacob for putting on this great event. I work at a think tank in Australia. I'm an SQP from academia and I'm a former advisor to the leader of two different political parties. So for me, think tanks are a kind of nice halfway house between the two different ways I see the world getting shaped by research and by politics. I'm gonna focus primarily on the politics of what we've been up to in Australia but first I wanna talk a little bit about the economics. But by way of introduction to the context some people might have seen my favorite picture before. I come from a country that has a larger share of the traded coal market than Saudi Arabia has of the oil market. If you think the Saudis are big in coal then we're a big... Sorry, if you think the Saudis are big in oil then we're big in coal. But you know, we're a plucky little country and we've got ambitions to double our coal exports. That's part of how we wanna help the world tackle climate change. Now you laugh, but let me be clear when we succeed you will fail, okay? Because if we put twice as much coal into the market just like the Saudis putting twice as much oil into the market we will push the price of coal down and people will buy more of it. That is in fact our plan. Now of course you know like I do that it would be silly to build a mine when the coal price is falling and falling. So I wonder if anyone in this room could kind of figure out how you might wanna build massive coal mines when the price of coal is falling and they're unprofitable. Any, anyone wanna have a go? Because the prices are second to none. Oh, they're gonna come back up and we're gonna subsidize the Bejesus out of the mines. All right, all the financial analysis you've seen of why these mines won't be built is the same financial analysis that said Hinkley Point wouldn't be built in the UK. All right, of course a mine, by the way this is 60 kilometers long. Okay, this is one mine that we wanna build. The state will subsidize the port, the state will subsidize the railway line, the state will subsidize the energy supply, the water supply, the water treatments and by the way we offered them what we call a royalty holiday. Does anyone know what a royalty holiday is? That would be free coal. So we're gonna build the infrastructure, subsidize the infrastructure, give them free coal. We're just that friendly kind of people. That's what we like to do. Now I know we're being recorded so I'll be careful with my wording. My country, just choosing my words carefully here, lies.  We've told the G20 that we don't subsidize fossil fuels. All right, that would be wrong. We don't do stuff like that. I can't show you this link unfortunately. I'm just gonna quote from a treasury memo that was obtained under a freedom of information request. When we wrote to the G20, explaining that we don't subsidize fossil fuels, Greenpeace in Australia put in a freedom of information request on all the documents that helped inform this correspondence. To quote from a memo written by a senior treasury official, we need to make a choice between trying to remove subsidies from the list through a narrow definition or keeping them on and justifying them. Use of a narrow definition has risks. It'll be seen as a failure by green groups and maybe contrary to the approach of intergovernmental organizations. It would also depart from the US-Canada approach. At the same time, use of a broader definition has risks as we have lots of measures that will be listed but not removed. I think that this is the key choice for the treasurer that he has to make. Adopt a broad OECD definition and list all the measures, brackets including those not inefficient, keep the OECD definition but only list the subsidies that we think are wasteful or have a narrow definition to one based on international costs and inputs, blah, blah, blah. We've got a whole correspondence chain on tens of billions of dollars worth of subsidies that were in the first cut of things we should report. These documents are all available if anyone cared but of course it would be impolite at the G20 for anyone to call us lying liars who lie. Would someone please do that? Because we're not gonna stop. We're gonna build mines like that with tens of billions of dollars worth of subsidies and no one's gonna be so impolite in an international diplomatic context as to point that out. So I wanna try and make three points in my remaining few minutes. The first one is that a subsidy, I'm an economist, apologies. A subsidy is just a negative carbon tax. It's a negative carbon price. And I don't understand, I don't understand why environmentalists and economists who are so excited about carbon prices are so quiet about subsidies. If you think a positive carbon price would change behavior, if you think a positive carbon price would shift incentives, what do you think a negative carbon price does? We spend tens of billions of dollars a year in Australia on negative carbon pricing. And yes, Australia briefly had a carbon tax, didn't last for long, and it almost collected as much revenue as the subsidies that we offer. Do you think it might be politically easier to go after the subsidies than to put in a new carbon tax? I do. But unfortunately, and I'll touch on this at the end, I think we've convinced ourselves that the reason to get rid of subsidies is they're a great way to fund spending on renewable energy. I couldn't disagree more. Getting rid of subsidies is a great idea because why would you subsidize something with negative externalities? Getting rid of subsidies is a good idea full stop. What you do with the billions is a second question. I actually think linking them is poor intellectual argumentation and, as I'll make the point in a minute, a bad political strategy. My second point is that, do you think that companies that are powerful enough to get tens of billions of dollars a year in subsidies from a middle-sized nation state might have the power to influence the way data is collected and presented in a country? Would you all please stop waiting until my nation state just kind of dishes it all up for you in a nicely formatted government documentation that says, here's the ports we've built, here's the railway lines we've built, here's the tax concessions we've given, here's the royalty holidays. We will never publish that information in that form ever, ever, ever, ever. And when international organizations or NGOs think that the only thing they can do is take the officially declared data and summarize it and analyze it, then you will never, ever, ever come close to unpicking what's really going on. Again, it takes a little bit of political power to get tens of billions of dollars. That is enough power to shape the way departments package up their budget papers. All right, but again, because it's actually hard to hide this much money, the data's available. But strangely, my government and the mining industry in Australia are reluctant to call it a subsidy. It's someone else's job to call it a subsidy. In Australia, it's certainly ours. Certainly, how many minutes have I got left? Two, okay. See, I don't really use PowerPoint. I've do got a slide. No, that's the wrong one. So we've got a new energy minister in Australia. See, there's a hint in the headline here. This is a newspaper story from just last year. New $5 billion infrastructure fund for Northern Australia. Guess where the mines are? Northern Australia. Guess what infrastructure means? Coal subsidies. This is what we do. In order to stop money like this getting spent on the coal industry, we work with very, very broad coalitions. Again, we're a research organisation. What we do is put numbers together, but we go out of our way to make sure the right people find our numbers. And for us, the right people are not the environment movement of who I get on well with most of them. The right people are the teachers' unions. The right people are the nurses' unions. The right people are the road building lobby. The right people are anyone with political power who wants cash. I wanna make friends with anyone with political power who wants cash. And what I say to them is, did you know there's a lot of cash sitting around at the moment going to an industry that the government says that it doesn't subsidise? If you could help us win a public fight about the government's hypocrisy in giving billions of dollars away on something it says it doesn't do, that would be billions of dollars that someone as powerful as you might be able to get a slice of. And what this also means, forget public debate, what it means is that within cabinet decision making, it's not just the environment minister sitting in cabinet losing a fight to the resources minister, and let's be clear in Australia that's the job of an environment minister, is to lose a fight in cabinet to a resources minister. What, when you stop trying to link fossil fuel subsidy reform to renewable energy spending, which actually intellectually have got nothing to do with each other, when you cut that, what you actually do is open up the opportunity that next time the resources minister shows up and says, can I have $5 billion to give to my friends, the teacher, the education minister says, oh, if there's $5 billion going, I think I might like to give it to mine. And the health minister says, oh, I didn't realise, I thought we were broke, I got the memo that there was no money, I now see there's $5 billion going for something we said we don't do, I'd like to give that to my constituency.  So to conclude, subsidies are just a negative carbon price. And in Australia and in many countries around the world, forget carbon pricing, will that tackle climate change? Well, it can't if you've got negative carbon pricing.  Because the powerful groups are so powerful, you'll never beat them unless you build common purpose with other powerful groups. And the best way to do that is to say, well, maybe other people can imagine what they do with that money. And on that note, I'll stop. Thank you. Thanks for deconstructing Australian politics in 10 minutes. I'm sure there's a lot of food for thought and food for questions as well, but I want to give Yvette Kerasimchuk from Global Subsidies Initiative and force her to provide some overarching comments on the papers. Yvette. Yeah, thank you. Thank you to the presenters. And also thank you to the organizing for having a separate session on coal. It makes sense for political reasons and it also makes sense for my subsidy measurement reasons. And it even makes sense to the fossil fuel industry itself because I don't know if you have heard Satel recently publish the report where they are calling, for actually calling the governments to curb the expansion of the coal industry. So we have to apply the Machiavellian or Roman Empire or British Empire rule of divide and rule and actually make the coal industry fight with the oil and gas and possibly nuclear industry and see how they destroy each other. I hope they can all hear that. They don't have the internet though. I'd like to congratulate in general all the three presenters. First I'm going to discuss your papers together. I found all of them very clearly written and your presentations very clearly structured.  This is all music to our ears. And I'm very sure that colleagues from OECD are also very happy because what you have done particularly for South Africa and for Colombia just expand using the same classification as OECD, expands the level of detail they can potentially also take up in their inventories. And examples from Australia also can enhance actually that exercise that you call the international organizations to do to actually tell the Australian government who they actually subsidizing because they are not going to say it themselves. So I was asked by Jacob and Harrod to focus actually on the ways how you can improve your papers. So I'll do so by saying that there are three jobs that you have done and all subsidy wonkers are doing. So first you have to identify and quantify the subsidies. That's a big job in itself. Secondly, you evaluate them. And then the third job is actually discussing how you can reform them. So going one by one, the identification and quantification exercise took us much further for each of the countries than we had known before. So congratulations on that. I don't think anyone got the definition of subsidies wrong because I don't think we need to discuss the definition in this particular room. People start discussing the definition of subsidies when they don't want to do anything and this doesn't apply to this community. Then with evaluation, you can evaluate differently. So we have a lot of people here who are PhD students and most of you are political economy or political science students. So I myself, I'm an economist but still the approach is the same. When you are writing an academic paper, you have to take a framework, have a hypothesis, try to apply the framework and test your hypothesis. So in this respect, I think there has been successful application of some of the frameworks when you are looking at the past and that's not just for your research. It's also for most of the papers that describe fossil fuel subsidies. What happens is that you get papers that can get a little bit descriptive and also you would start describing all the million, zillion reasons of why fossil fuel subsidies exist. So you have past dependency, you have resource curves, you have a lot of different concepts that work retrospectively. But when you try to find concepts that would have to understand how you can reform subsidies, that's a much more challenging situation. And more who has left than Jacob, so we tried actually applying the advocacy coalition framework to fossil fuel subsidy reform and see what happens. And Jacob has also reviewed our paper on, not on fossil fuel subsidies, but on coal phase out in Ontario. So it's hard because we know what happened in the past. We have frameworks, but we think within this box and to solve problems as we all know from Albert Einstein, you have to think outside of the box and at the level beyond the level at which all the problems were created. So I think Richard obviously took it much further with your practical application of how you build coalitions. So you very correctly say that in terms of a violation of subsidies, they don't make any economic sense. It's just even not worth discussing. And in terms of a political strategy, you have to build a very broad coalition of different stakeholders. And in cases where it has worked for coal, so there are a few countries that either faced out coal production or faced out subsidies or ends the process. So they are mostly European countries. It's German and Poland, they were mentioned before. And then to a certain extent, the UK and France and China is now going through this process. So what you have is that it's a combination of low price, which we have now for commodities. And then rising cost of production, which actually makes it's economic and feasible. So we have one ingredient of this story now, which is the low price. And then the subsidy becomes expensive because Richard what you said is true that you can as a coal mining company, you can hope that actually, if there is no market, the government is going to bail you out. But at some point they just, the government will not have enough cash. So in this sense for the broad coalition, yes, you can also cooperate for instance with trade union so that they actually rise the cost of production even more by better, by better conditions of work. So you can have more social standards for coal miners who are very vocal in their protest. I agree with Richard fully on the need to, a certain extent to de-environmentalize the arguments. And I think it's a very valid point for allocation. In some cases we have found in our work as a global subsidy initiative, it makes political sense because, especially when you introduce a positive carbon price, you need actually to explain where this money is going to. But when you do it with a negative carbon price, then yes, so maybe it's much better not to talk about renewables, but it depends very much on different countries and individual contexts. So I look forward to more work from all of you, more publications, the work that we'll actually discuss how these political frameworks or strategies can be applied in different contexts because you have done this first step of quantifying, describing the problem. So obviously just the beginning of thinking further about in terms of political economy analysis. So what I would like to discuss as a concluding part is actually trying to make, connect the dots and talk about the three individual countries and what unite them on the global arena. Because as you all said, a lot of production is export-oriented, especially for Australia and Colombia and to a certain extent to South Africa as well because South Africa exports high-quality coal and one of the main markets has been China which now started its own process of rationalization of the coal mining industry. They have too much coal capacity, both in the electricity sector and in terms of mines. So and with the global economic slowdown and China's reduced consumption of coal, of course it had struck back to each of the coal producing countries and the other one is Indonesia, which we're not discussing, but the industry, coal mining industry in these countries losing the Chinese market actually started asking even for more coal subsidies domestically. And I think that's also like an interesting point for analysis, generally in terms of leakage, like nobody mentioned leakage so far. I know that also the colleagues from the Stockholm Environment Institute, Michael Lazarus and Peter Xunzei started this work saying that supply side mitigation actually may lead to less leakage than demand side mitigation, but this is something really important when we think about all these political strategies if fossil fuel subsidy reform succeeds in one country, what will happen to others? And obviously China is a very interesting case in this respect. So I'm glad that you mentioned also different international players. So I think also, Claudia you mentioned in your paper, the international financial institutions and all this ambiguity between on the one hand, being champions of fossil fuel subsidy reform in the OECD countries, sorry, on the global arena and saying that developing countries should move on with the reform and not doing much with their own finances. So that's quite fair. And you also talked about race to the bottom, which I think provides also interesting analogies with maybe Michael Porter hypothesis because if you think how he was talking about pollution, he was also talking about race to the bottom and race to the top. So his hypothesis is that over the long term, the countries that win are those that are actually scrutinizing their industry more that have more stricter environmental standards and that hopefully can be also something for the energy sector, that those countries that have stricter standards will become over the long term more competitive. So Chris and I will have a session and formal session over drinks. Today, when we talk, we'll talk about this. So I will not repeat myself there because I'm going to talk only about oil and gas, but I think it's very much true. So we have this race to the bottom and in the end it may kill, the industry just because it used to be a cash cow for governments, even the coal industry, but now it's much more actually a subsidy recipient. And the more we talk about this, I think the more the balance can shift. And to conclude, speaking of broad coalitions, what I was thinking on the way here to Stockholm where that actually, even small countries like Sweden can play a role as a member of Friends of Fossil Fuel Subsidies Reform. Or all you have to do is just to make Swedish pilots demand not a salary increase, but a reform of fossil fuel subsidies and then that will get vocal enough actually for people to start caring about it. And thanks for reminding us also that not just these countries are linked, but of course many other countries link through global coal markets as well. And even though we're looking at maybe individual case studies, it's important to remind ourselves of these international linkages. And thanks also for basically pointing out that even though we might be looking at individual countries and collecting data at the individual level, it's part of a larger exercise of getting more data about subsidies in general, so that each of us is actually contributing to let's say a larger study. So we have about half an hour for questions from the audience. So I open the floor. Alex? My questions for Richard, I read the paper and there's a little bit more on this than what you talked about in the presentation, which is more of a challenge to the environmental framing of subsidies, which I think I'm very much aligned and oil change is very much aligned with your perspective that it's important to try and build broader coalitions and getting people outside of the environmental movement involved and advocating for having a vested interest in ending fossil fuel subsidies. But I wanted to ask you, de-environmentalizing versus building different alliances is they're kind of different questions. So I totally understand breaking the link between ending subsidies and repurposing that money for green issues. But what about, are you suggesting that it's probably best not to focus on the climate benefits, for example, of removing subsidies? Would it not make sense to, in Australian context, still try and articulate just how big the benefits could be of removing the production subsidies from your perspective, or do you think it's still worth pursuing that angle? Richard, before you answer and let's take at least one more question and then ask Sir Ron in the back. I guess we're still webcam live. I think so. Okay. Let me think of how I can phrase this. I was wondering, from Claudia, that whether, in the case of this, Sir Ron, am I pronouncing it right, coalmine? The Sir Ron? Yeah, yeah, okay. That were you aware that the original history of this, that there was, in a sense there's a link with a previous policy in the Netherlands, which was after the late 70s price rises for oil and natural gas, there was pressure in the parliament to put a windfall profit tax on the Kronigen natural gas. And instead of that, the government proposed a what was called the gentlemen's agreement, the Herren Accord. And part of the Herren Accord was that the companies affected Shell and Exxon at the time would instead invest an amount equal to what the windfall profit tax would have been in supplies of energy for the Netherlands. And one of the investments that was credited towards that was the investment in the Sir Ron coalmine. So another one of these full circle things. Thanks. I wanted to ask a question to Richard too. Just about this, I don't know how far it's gone, but these discussions with sort of, as you talked about sort of powerful interests that you are looking for money. I mean, how far has that gone? And would there be information that others could take up to use similar approaches in other places? So are there success stories of actually budget decisions being made differently? Or what would be the time frames over which you think that might happen? There was some, it'd be interesting also just to hear about how the press have covered some of those questions because there was that story that, well at least maybe in the bubble that I exist in, which was about in Oklahoma and the US, how subsidies were being given to fracking and schools were basically having a huge cost as a result. Just a question for Richard as well. I wanted to ask what the kind of, how you, kind of the advice you were giving on subsidy reform, how you feel it kind of fits in terms of global scope? Because obviously in terms of global scope, because in some countries, people who are very powerful, who would be best placed to take advantage of resources liberated or people who we'd least like to have access to those resources. And often trying to get some sense of how money will be spent instead is important to kind of just build in credibility of the government in context where there's very low trust that resources will be used in any better way. So just kind of curious to hear how you think your kind of analysis transfers to kind of other contexts maybe where kind of governance is purer. Then maybe I can add again, Chair Sparrogative, a question for Jesse as well. Yeah, Jesse, you and your colleagues have been very much involved in doing modeling and scenarios at development for South Africa at the national level. Have fossil fuel subsidies played a role at all in existing scenarios and if not, why? So even maybe you can understand from a government perspective, but from a research perspective as why has no one looked at it yet? Richard, you might want to take off? Yeah, sure. Look, I'll try and bundle them all up, but happy to discuss at length over beer or coffee. To start with sort of a challenge to the political scientists in the room, I'm an economist. When people look at how these strategies kind of work, it's very hard to measure and I've never really seen any interesting stuff which doesn't exist on how you quantify if you're gonna have a model of change, how you quantify the skill of political strategy because it's a scarce commodity, right? It is, it's a scarce commodity and it costs a lot of money and business groups spend a lot of money buying this scarce commodity called political strategy and then they use it and they win, right? So in part of our strategy for the fossil fuel subsidy stuff and I know we're being recorded so I hope they hear this, at the peak of the mining boom in Australia we called them out on enormous subsidies that had never been called subsidies before, right? We took months to go through 50 budget papers, eight years of budget papers for six state governments. No one had ever done it before. We did it at the peak of the boom, at the peak of their power, at the peak of their hubris because we actually were betting and good strategy, you know, thinking about a game of chess, a good move isn't just a good move if your opponent does one thing, a good move is a good move regardless of what your opponent does. So we said that their subsidies were enormous at the peak of their power and we bet on their hubris and we won, they came out and they said, we don't have any subsidies, that's an outrage, how insulting, we have none. Keep in mind we got them to say this at the peak of the boom. Now what's happened? Commodity prices have collapsed and what have we got them on the record? Very loud and very clear saying, got none, need none, perfect, idiots. Can't believe they said it. So part of our strategy in talking to teachers, nurses, you name it is the government says they don't get any, the industry says they don't need any. So any new suggestion of any form of subsidy, it's very easy to get other groups to fantasize over that money. And similarly, we've got those same groups helping us win our fight about the definition of the subsidies that already got because it's in their interests to win that public argument about the definition of subsidies because if we can win that public argument about the definition, then that's money the government says they don't spend on something the industry says it doesn't need. So how do you take that further afield or in global in scale, good question. I think political strategy is important whatever you're doing, which groups have got power how do you engage with them? Well, that's a long conversation. But one thing that sprang to mind when you asked that question was I'd be going to all the aid groups in the world and saying, you realize you're raising a lot of money to help developing countries develop. And those same developing countries are wasting money on inefficient subsidies that cause climate change. Call them out on it as aid groups. Say we are doing everything to help lift your kids out of poverty. We are doing everything we can to help you and you're given money to people causing climate change. That's incredibly powerful position to be in having aid groups just say we're trying to do everything we can to help give kids a good education and the countries we're giving it to are wasting it on subsidies. Now, then to your point, or maybe Sheila's, is it okay to mention climate change? Of course. That's just a benefit. That's a bonus that comes with it. Or maybe it was your question. Is it okay to mention climate change? Does that make it green again? No, I don't think so. But that's a secondary benefit. The cash is what motivates existing interests with existing priorities and existing strategic plans to care about your otherwise peripheral problem. How do you make your peripheral problems central to their strategy? Make it central to their strategy. Shift cash for them. If we go back to history, there is one other interesting point is that in the coal sector, so Serechon was first established as a joint venture between Filière, what's the name in English, a company belonging to Exxon and a national coal company. So there there was strong development state, developmental state intention to develop coal with the national coal company. But then with the structural reform, it was sold. And the result is that now in the coal industry, there is no state-owned company. And if you compare the level of legislation, government take and subsidies between, diversity of subsidies between coal and not fossil fuel, you get a completely different picture because you don't have a nationally owned company. It's quite interesting to see how it can make a difference and the way you mentioned if international financial institution play different role. Thank you, Harrow. You know, I'm actually not sure. Some quite boring reasons like data. Well, not boring, I mean, interesting, but boring. How would you know what, how do you capture particular things in models? How have models been developed historically? For example, my department, we've got a linked energy economy model that never had sassel separate to the refiners. So, you know, that kind of kind of boring stuff. Other reasons is narratives and beliefs, I think. I think even within research, people don't believe that you can get by without something like sassel or they've never thought about how. In big internet, not international, in sort of large national debates, both Escom and sassel have just said no when people have suggested that there might be decarbonized electricity by 2050 or that you might close coal to liquids by 2030. They just got looked at gas. So their beliefs about the evolution of future pathways is very divorced from researchers. And also researchers, even in South Africa, kind of beholden to international funders and the international agenda. So until there was like sort of international movement around this, I just don't, I don't think it ever entered their brains. It's about carbon pricing and things historically. And it's left for maybe a few more questions, is that right? Oh, wow. So let's start here in front of us. Sorry. So we have Laura, I'll check her. It's just this evolution upstream. A lot of the work, many of the countries that we've worked on with GSI has been around the consumer subsidies to keep prices low to consumers, but also on electricity. So to keep, for example, in South Africa, I think there are still subsidies to very poor families with electricity. But so I just wondered what's the situation around those consumer subsidies in these countries because maybe all the emphasis now is on these producer subsidies and upstream and it's already, those consumer subsidies have already gone or that's... My question is actually to Iveta. This is more sort of a clarification. So yeah, my question is more to Iveta. Sort of clarification, probably I got it wrong, that's why. So you mentioned that as we increase the production cost for the coal, maybe by through labor unions, asking them to go for, asking for higher wages and so on, you improve the chances of reducing the subsidy. So I didn't quite get it. Like, is it really that you're assuming this lower and then usual wages as a hidden subsidy again? And if so is the case, then it is probably related to, or it is there with most of the production that is being consumed now in Europe or North America, which is coming out of China on lower wages. So is that the reason or how you're trying to say that increasing the cost is basically going to reduce the subsidies?  So I see that two of the papers are focused on state-owned enterprises. And I'm not sure is that the same case in Australia, but if not, if there are private coal companies in Australia. So I just want to understand, in your opinion, what do you think are the motivating or driving factors for governments to continue subsidizing coal extraction given that some companies are state-owned versus private? Thanks. Iveta mentioned Machiavelli and the potential to divide and conquer. I'm curious your take in your respective countries if there is any fissures that could be exploited either between coal and other fossil fuel industries or between coal and their allied industries with respect to subsidy reform that wouldn't backfire and result in additional subsidies for those other sectors. Thanks. Just a quick question for Jesse, actually. Jesse, you mentioned quite a lot about, or you described a lot about the dynamics within the energy sector, so Escom and Sassol. But in passing, you also mentioned, like from the 1990s onwards, this agenda around black capitalists or introducing the black economic empowerment program and so on. So I'm just interested in how much you think that is part of the dynamics of general support for the sector, the subsidy regime and so on, as opposed to this being strictly an energy, the vested interest really being in the energy sector, energy players, rather than a whole different group altogether. Questions then, so Jesse now. Okay, so on consumption, I know South Africa subsidizes electricity, they've got something called the Free Basic Electricity Program. They also subsidize paraffin use, so kerosene for low income households and those remain in place. There's quite a large body of literature critiquing, especially the electricity because it's not very well targeted. So it's related to, if you have a low enough consumption, you're assumed to be a poor household, you get a free allocation. And so anyone can get that if they have low consumption and also you have very large household sizes in poor communities who have a higher than average household consumption, but who should actually be getting it. I'm not sure it's a very good way of dealing with energy poverty. I'm sure I think there are better ways and it's also led to kind of focus on electrification which has ignored that there are actually other ways of giving those energy services to people. But they do remain, but I can kind of see the point of them. You know, they're playing an important role now in trying to mitigate energy poverty which I think you probably couldn't undo without causing an enormous amount of upset. State-owned companies. So interestingly there's a state-owned miner, a coal miner in South Africa who actually have got a series of loans which we're not sure if they've ever been paid back or not. So I didn't put them in the presentation. They're getting a lot of support and they've got some Escom contracts, but they're the only part of the coal mining industry that state-owned. The rest of the coal mining industry is private, but it's supported entirely through its negotiations with Escom and that links back to what Aaron was saying. So Escom is contracting with coal suppliers who often are much higher cost than the kind of the old capital I call them, the Anglos, the Glencore, that sort. Because they've got this industrial policy objective about creating new black industrialists and they will take higher prices, we think it's also very hard to know actually what they pay for coal to different people, but they will do that because they've got these other distributive ideals, although they're not directly state-owned companies themselves. So about the consumer side, it's very straightforward. I don't know, sorry. About the state-owned company, so there is no state-owned company in the coal sector. I think there is, well, there is like, you mentioned like passenger resources, like there are many reasons. There is one reason in the specific context of Colombia that I'd like to explore more deeply. So I don't know. I can't say it is the case or not, but I think it's a question that is exploring the link between regaining territorial control and the mining activity, what it means in terms of having heavy infrastructure in regions that are difficult access. They built airports for the activities, mini airports. I mean, I think that might be also part of the incentives behind that, but at the same time where there is rent, there are actors and illegals that are looking to capture it and there have been quite a few studies that look at the correlation and the causal links, which is much more difficult to make the case between extractive industry and violence. So that would be maybe something to explore further. I'm not saying it's the case. It might also be very different between coal, gold, nickel, and other types of minerals, but that's something that could be looked in more in detail. And about your question, I think the framing part is quite important in the common case, like separating coal from the rest. I mean, there are lots of reasons that are not climate related to do that. One is the very different in the weight it has in the economy, different regions, quite concentrated geographically. There is a very different kind of environmental impact and a big one is that there is much less illegal mining issues than for other big minerals activities. And I think like trying to start to talk about it in a different, separate from the rest, can really help lower down the resistance because now when you attack coal in a way, I mean environmentalists that attack coal, they get the whole mining sector back. The producer and consumer subsidy thing, I met a few people a few years ago in London at a conference and I was a bit surprised at how excited people are at that difference. They're just subsidies from my point of view. They have the same economic effect. Politics are different for everything, but they're subsidies. In Australia, a lot of our consumers are producers. So we have $8 billion a year worth of fuel tax subsidies. The major beneficiary is the mining industry who is the biggest user of diesel fuel in Australia. So our consumer subsidies for fuels are actually a producer subsidy for our coal miners. They're just subsidies. The motivations of state-owned enterprises, there are state-owned coal mines in Australia, fewer and fewer, but certainly, there are lots of state-owned power stations, so the incentives there are quite different. There have been state-owned coal ports and coal infrastructure, so subsidies matter there. Newcastle Harbour, the world's largest coal port, spent 19 years without increasing the prices that charged to transport coal. There's no other government service in Australia, buses, trains, electricity, that didn't have a price rise for 19 years, but coal through the world's largest coal port, no, no, just as luck would have it, the price 19 years ago was bang on the money. So, but of course that's not a subsidy in Australia. That would be wrong. We don't do that. As for the divide and conquer the Machiavelli stuff, look, there's really only two kinds of political strategists, ones that love Machiavelli and those that love losing. So, and again, if you've never read it, that's fine, but don't play against people who do and expect to win. Like, just be clear, it's a skill and you learn it and the people that are winning are good at it. So, yeah, there's lots of divide and conquer opportunities and practice in Australia. Gas versus coal blew up. That's a big gas, bad expression perhaps. The annual gas love in last week was split on whether they should attack the coal industry or not. Should the gas industry just go for coal's throat in Australia or should the fossil fuel industry stick together as a political class? Now, it's obvious that their interests are different, but it's a club and getting a club to break is hard. They should have broken economically, they should have broken years ago, but this year's gas conference was an interesting turning point. In a flat market for coal is, you know, forget structural decline or not, even if it's just flat and stagnant, every new coal mine that opens reduces the market share and the market price for every existing coal mine. So, every owner of every existing coal mine should be opposed to anyone that wants to build a new coal mine. You don't see many casino owners hoping another casino will open up next door. So, in Australia there's a nice geographic tension between the existing New South Wales mines and the proposed New Queensland mines, but keep in mind, pardon the pun or pardon the slip, but those mines are owned by the same companies. So, even though the geographies should be rivals, a collective class owns both of them, which makes breaking it up a little bit harder. The biggest divisions in Australia that are fun to exploit between the conservative farming political power base and the conservative mining political power base, because the new mines are increasingly on farming land. So, that's not a intra-fossil fuel tension, but it's very powerful in Australia. Ripping up farmland to build mines makes farmers not happy. The ones that get paid millions for their land are happy, but the neighbors don't like it. And just sort of on that big picture, you know, I really thought the stuff this morning about norms really matter is important in these fights. If people think the norm is that mining is this sort of backbone of the economy, it's much harder to exploit those divisions between oil and gas, et cetera. Whereas once the norm is that it's actually a subsidized industry that's falling over, it's actually a lot easier to divide them when they're on the run. Just to give a defense of maintaining the distinction between producer and consumer subsidies. Yes, a producer subsidy can become a consumer subsidy if the pass-through is through and et cetera, but at least from a trade standpoint, and therefore I would say from an economic standpoint, you know, you could have a country that's primarily a producer and it's having very different effects globally and in that country than a consumer subsidy if actually the number of consumers in that country are very small. So, the magnitude, where it eventually ends up in all that, they're important distinction. So, I wouldn't say that the distinction doesn't matter. I wouldn't agree. Counting point of view, I was, no, no. Yeah, okay, but I guess what I'm trying to say is that politically, subsidies are subsidies and the categories might matter for some people, but if you're trying to get rid of them, it doesn't make sense. I think you should try and get rid of the ones that are the worst that you have the most likely chance of getting rid of rather than decide I'm a producer subsidy kind of person or I'm a consumer. No, no, I know that's not what you're saying. I'm saying there's subsidies. You can categorize them oil versus gas. You can categorize them producer versus consumer. I'd say just look at them as subsidies and think which one can I get rid of and how should I go about doing it? I think, and I need to clarify it. We are talking about the future here, right? We don't know. And politics is that are feasible or possible or impossible. What we know for facts are two things. First that the developed country that have phased out coal closed down mines or phased out fossil fuel subsidies because for some countries it's politically easier to shut down coal mines rather than phase out fossil fuel subsidies. So those countries mostly in Europe they have done it because of higher costs. So coal was not competitive. Coal from their mines was not competitive on the market anymore. And how you make coal not competitive from that particular mine. You have the price at which you can sell which is now falling and you have the cost at which you produce which you can increase if you improve social standards and standards of working. And the second fact is that trade unions are a powerful force. So if we speak about Swedish pilots or if we speak about trade unions in South Africa. So if we connect the dots between the two sessions today so Tyce was talking about the experience of anti-apartheid movement and we have heard that McKibben was advised by actually one of the masterminders of anti-apartheid movement. So in South Africa trade unions played a big role in anti-apartheid movement. Like can we actually make them use this experience in fossil fuel subsidiary form or coal mine shut down so it ultimately doesn't matter. So and speaking of divide and rule even though Richard you said that $1 subsidy is $1 subsidy is the same thing for consumer or producer. I disagree with that and I think that you as an economist if you actually get a good sleep you will figure out that it's not the same thing because you have different types of subsidies. So coal miners very often can retire early so government can often provide pension to them at a higher rate and over a longer period of time because they retire early. So they have some health benefits, insurance benefits but these are the costs to the mining industry rather than actually the transfer to the coal mining companies. So you can have this divide and rule even in the subsidy world. So if you want to have your strategy to make fossil fuel subsidies so expensive that finally governments cannot sustain them anymore you can actually work on improving this like social subsidies to miners and some other uses while reducing the subsidies the proportion of subsidies to actually exploration and extraction and hardcore stuff. Well this usually would be the time of day where energy levels start to drop. I see more questions coming up at the same time I think I'm very aware of the time so sorry Sheila I think we need to save that question for the next session. Before we go to break let us thank the panelists once again for their very good interventions. And we start again at four o'clock.


I visited a local primary school in Thouse Brisbane district and asked students about their understanding of rural safety. That's here what they had to say. Why do you think it's important to wear a helmet? So, in case you fall over, your head won't crack open and, yeah, it's for safety. Because, so you don't crack your head when you're riding a bike or a skateboard? I think it's important because you don't want to get hurt while you're riding and you don't want to get your head hurt. When do you put your seat belt on? In the car. And when you, before you start to drive, you have to put your seat belt on. Why do you think it's important to wear a seat belt correctly?  And it's very scary, but if you're at the chair behind, you'll just bang into the other chair which will probably hurt. And when can you undo your seat belt? When the car is stopped. When the car is stopped is where it's its destination and the driver's ready. Yeah, when you're done. When the car is stopped and fully parked and when you arrive to your destination? Why do you think it's important to follow the real size and traffic lights? Because if, because they're made to keep you safe and if you don't, you might get in a car crash or a car might hit you while you're walking on the road. If you're crossing a road and it's red light, a car could just come over and run you over. Because if you don't follow them, you might go into an accident or you might get fined, like by the police. We're taking this out with me.