Decision on coal subsidy phase-out not imminent: Angel Gurria, OECD

LONDON: A decision on phasing out a form of coal subsidy is unlikely to come soon but discussions among members of the Organisation for Economic Cooperation and Development (OECD) continue ahead of UN climate talks, the OECD's secretary-general said on Friday.

The OECD has been trying for a year to get an agreement from its 34 member nations on ending export credits for technology used to produce coal, the most polluting of the fossil fuels.

OECD talks in June ended in stalemate as Japan, a major user of the aid, led calls for more time. However, sources close to the matter said nations would review the situation over the summer before further discussions in September.

"I frankly at this stage do not think a decision on the subject will be imminent," OECD Secretary-General Angel Gurria told reporters at a briefing in London.

"But the context seems conducive to the discussions because we have COP21 (U.N. climate talks) ... It focuses the mind," he added.

Paris will host United Nations climate talks in December, which aim to seal a deal to cut greenhouse gas emissions from 2020.

Many organisations and climate experts have called for fossil fuel subsidies to be phased out. Rich nations provided around five times as much in export subsidies for fossil-fuel technology as for renewable energy over a decade, according to OECD data seen by Reuters earlier this year.

At the OECD talks in June there were "very polarised opinions and the two camps were extremely adamant in their arguments", Gurria said.

The credits help companies such as Japan's Toshiba Corp sell coal plant and mining technology abroad.

A proposal by the Finnish chair of the OECD talks was to gradually change conditions for receiving export credits depending on how efficient coal-fired plants become.

"It doesn't have to be all or nothing: you can go down a middle path. You have a less obvious route to solving the problem," Gurria added.

Without new steps to curb emissions from coal use, coal generation is forecast to emit more than 500 billion tonnes of carbon dioxide between now and 2050, which would undermine a worldwide aim to limit a rise in global average temperatures to under 2 degrees Celsius.

The scale of new investment in coal-fired generation poses the most urgent threat to the world's climate and many coal plants being built today might have to close before the end of their economic lifetimes, Gurria said.