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Subsidies to the Use of Natural Resources

Environmental Economics Research Paper No.2
This report was prepared by a consultant,
the National Institute of Economic an Industry Research (NIEIR),
for the Department of the Environment, Sport and Territories.
© Commonwealth of Australia, 1996
ISBN 0 642 24864 8

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Fish Graphic

When this study was originally developed by the Department of the Environment, Sport and Territories, it was hoped that sufficient data would be available to enable preparation of a study report which would be largely figures showing the extent of financial and environmental subsidies to natural resource use, in a number of areas.

However, as the study was progressed by the consultants, in consultation with the Department, it became clear that there were many conceptual as well as practical difficulties in getting the data which is the aim of the study. The report therefore developed as more of a discussion document and less as a catalogue of hard figures.

Nevertheless the Department considers that the report makes a valuable contribution to information about subsidies to natural resource use, as regards both the discussion of issues involved in such measurement, and the partial but indicative figures that have been estimated.

Contents

Executive summary
1. Introduction
1.1 Study scope
1.1.1 Definitions
1.1.2 Significance of subsidies
1.2 Study approach
1.3 Conceptual issues
1.3.1 Introduction
1.3.2 Costs for the assessment of financial subsidies
1.3.3 Valuation of environmental subsidies
1.3.4 Effects of reducing subsidies
1.4 Subsidy policy developments
2. Energy production and consumption
2.1 Introduction
2.2 Fossil fuels
2.2.1 Coal
2.2.2 Natural gas
2.2.3 Oil
2.2.4 Greenhouse externalities associated with fossil fuels
2.3 Renewable energy sources
2.3.1 Introduction
2.3.2 Renewable energy and subsidies
2.3.3 Renewable energy trends
2.3.4 Renewable energy forms
2.3.4.1 Biomass
2.3.4.2 Non-biomass renewables
2.4 Electricity
2.5 Energy use
2.6 Road transport
2.7 Other transport modes
2.8 Summary

3. Water
3.1 Introduction
3.2 Financial subsidies
3.3 Environmental subsidies
3.4 Summary

4. Waste water treatment and disposal
4.1 Introduction
4.2 Financial subsidies
4.3 Environmental subsidies
4.4 Summary

5. Solid waste disposal
5.1 Introduction
5.2 Financial subsidies
5.3 Environmental subsidies
5.4 Summary

6. Extraction of forest products
6.1 Introduction
6.2 Financial subsidies
6.3 Environmental subsidies
6.4 Summary

7. Use of publicly owned natural attractions for recreation and tourism
7.1 Introduction
7.2 Financial subsidies
7.3 Environmental subsidies
7.4 Summary

8. Agricultural chemicals
8.1 Introduction
8.2 Financial subsidies
8.3 Environmental subsidies
8.4 Summary

9. Extraction from publicly managed fisheries
9.1 Introduction
9.2 Financial subsidies
9.3 Environmental subsidies
9.4 Summary
References

List of tables

ES1 Summary of subsidies, removal policy instruments
ES2 Summary of subsidies to the resource activities studied

  1. Potential externalities associated with electricity supply from primary non-renewable fuels
  2. Application of damage/avoided damage costs to black coal based electricity generation in Western Australia
  3. Estimated externality values for Loy Yang A
  4. Relative contribution to atmospheric pollution in Australian cities by source, 1985
  5. Aggregate costs of vehicle emissions in Australia 1989–90
  6. Indicative transport externality costs for selected countries
  7. Energy consumption in Australian transport, 1992–93
  8. Summary of financial and environmental subsidies, 1994, energy sector
  9. Real rates of return for water management in Australia
  10. ARMCANZ 1993–94 survey: key outcomes for metropolitan water (preliminary)
  11. Summary of financial and environmental subsidies, 1994, water sector
  12. ARMCANZ 1993–94 survey: key outcomes for metropolitan sewerage (preliminary)
  13. Objectives, budget and expenditure for the SEL
  14. Summary of financial and environmental subsidies, 1994, waste water treatment and disposal activities
  15. Summary of financial and environmental subsidies, 1994, solid waste disposal activities
  16. Summary of financial and environmental subsidies, 1994, public forests
  17. Estimated visitor numbers of some major natural attractions 1982–1992
  18. Access, entrance fees, revenues, etc. to national parks in Australia, 1994
  19. Summary of financial and environmental subsidies, 1994, natural attractions
  20. Artificial fertilisers: area and usage in Australia, 1986–87 to 1991–92
  21. Summary of financial and environmental subsidies, 1994, agricultural activities
  22. Gross value fishery and selected major fisheries categories, 1988–1992
  23. Summary of responses received from Commonwealth and State fisheries agencies on exploitation of species, species groups or stocks
  24. Expenditure on fisheries management and research: Australia 1990–91
  25. Summary of estimated additional costs over five years
  26. Summary of financial and environmental subsidies, 1994, public fisheries

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© Commonwealth of Australia, 1996
ISBN 0 642 24864 8

This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Commonwealth Department of the Environment, Sport and Territories. Requests and inquiries concerning reproduction rights should be directed to the Commonwealth Department of the Environment, Sport and Territories.

Department of the Environment, Sport and Territories
GPO Box 787, Canberra ACT 2601.
Telephone: (06) 274 1111 Facsimile (06) 274 1123

This report was prepared by a consultant, the National Institute of Economic an Industry Research (NIEIR), for the Department of the Environment, Sport and Territories. Its conclusions are those of the authors and do not necessarily represent the views of the Department.

Original Design: Rochfort Art and Design, Canberra
Original Typesetting: Typetalk, Canberra

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