Global Journal of Science Frontier Research, H: Environment & Earth Science, Volume 23 Issue 1

the absorption capacity of each country. Forcing ambitious and distant goals, or discouraging certain technologies with arbitrary regulations will not generate progress. A more promising path is to align interests through pricing and taxation practices that adequately reflect environmental costs, and facilitate investments responsive to consumers, avoiding complicated coordination. II. T he E merging R eality “Quis custodiet ipsos custodes?” (Who watches the watchers?) Latin locution by Juvenal. The lack of foresight, the low energy security implied by the energy matrix and the consequent crisis triggered by the conflict in Ukraine have prompted the 51 largest economies to double support for fossil fuels to almost US$700 billion in 2021, and even larger amounts in 2022 - there by mitigating energy price increases for consumers, while generating incentives for increased fossil fuels supply to achieve a quick response to overcome the energy crisis. This is undermining the elimination of inefficient and distorting subsidies, flagrantly contradicting the declared ecology friendly policies and pledge s 3 Clearly, environmental institutions are generating costly inefficiencies, undue room for discretion and arbitrariness, and associated risks of corruption. A central objective of institutional redesign should reduce these spaces and offer higher levels of certainty and objectivity, and economic grounded . This practice was not only limited to major economies where fossil fuels consumption is the greatest, but spread to emerging countries, such as Chile, which had instituted countercyclical practices of subsidies (when prices increased) and taxes when fossil fuel prices declined, in such a way that on average, there was no subsidy. This provided for a proper level- playing field for renewables, and enabled major investments in renewables (see Attachment). However, with current global subsidy practices, the fiscal cost associated with financing fuels of almost US$3 billion was written off, involving a reduction equivalent to 74,000 social housing or 3.7 times the annual subsidy to the Trans-Santiago public transport system, which illustrates the social cost of such action. More broadly, regulatory interventions have generated counter- productive results through institutions with crossed, and often conflicting responsibilities, where technical factors and political factors are mixed. Oftentimes, this has generated disincentives of costly delays, resulting in projects taking longer to process for approval than to execute. 3 IEA analysis OECD Inventory of Support Measures for Fossil Fuels. https://www.oecd-ilibrary.org/agriculture-and-food/data/fossil-fuelsupp ort_d86aea00-en. criteria, to generate energy supply that is affordable, reliable and cleaner. In this way, environmental decisions would be more integrated to economic development imperatives and market demands 4 Moreover, as early phases of development tend to be more energy intensive as new machinery needs are introduced, the growing energy demands that will take place mainly in emerging economies (as can be seen in the graph below) . 5 . 4 Cambiando la conversación sobre transición energética. Miguel Schloss, Diario Financiero Dec.. 26, 2022 https://www.df.cl/opinion/ columnistas/cambiando-la-conversacion-sobre-transicion-energetica. 5 Global Journal of Management and Business Research, 2022; Miguel Schloss—Changing the Conversation on energy Transition. https://drive.google.com/file/d/13diV_LtnNa0iq_3KBZvbR6afW7L_Le/vi ew. Aligning Interests or Precipitating Energy Transition © 2023 Global Journals 1 Year 2023 2 Global Journal of Science Frontier Research Volume XXIII Issue ersion I VI ( H )