Oil and gas companies get a ton of subsidies from governments which holds back the adoption of renewable energy. In most countries, the gas industry is supported by policies encourage car use and other related infrastructure decisions. Sometimes, like in Morocco, fuel is directly subsidized and recently the country found that it was just too expensive to augment the market so bluntly.
Morocco should be held up as a ‘poster child’ for effective green policymaking, according to the World Bank’s top climate official.
Speaking at an environmental meeting in Pori, Finland, Rachel Kyte said the Rabat government’s recent decision to cut tax breaks for petrol and gas used a template other developing nations could follow.
“What Morocco did was remove subsidies on fossil fuels, because they couldn’t afford it, not because they had a big climate goal, but because they couldn’t afford the subsidies,” she said.
“Then they started to incentivise investments in renewable energy, domestic and foreign.”