Abstract

Ireland’s Central Statistics Office (CSO) publishes statistics on environmental taxes and subsidies. To complement these two statistical releases the CSO also developed a statistical release on fossil fuel subsidies, which presents data on three indicators: fossil fuel subsidies, effective carbon rates and effective tax rates. The release attracts media and policy interest as the support for fossil fuel consumption appears to conflict with the transition to low carbon policies. In this paper we examine some of the challenges of compiling data on explicit and implicit fossil fuel subsidies, as well as how we have addressed these issues.

We look at the benefits and challenges of producing an inventory of fossil fuel supports, including decisions on which explicit and implicit measures to include. We describe the effects of temporary tax rate reductions which were implemented in Ireland in 2022 on the measurement of implicit subsidies.

We argue that the inclusion of other indicators can complement the inventory approach and build a fuller picture of fossil fuel support. For example, data on effective carbon rates can facilitate international reporting and comparisons, as well as comparisons between different sectors of the economy. In this paper we outline our approach to compiling effective carbon rates, referencing methodological issues such as treatment of emissions trading scheme permits and electricity taxes.