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Greasing the wheels of fossil fuel production — and consumption — will cost $5.3 trillion in 2015, coming in the form of subsidies to oil, natural gas, and coal, according to a report from the International Monetary Fund (IMF).
That's right: $10 million every minute of the year goes to keeping fossil fuel prices low and demand high for the benefit of the most profitable industry in history.
According to the IMF's calculations, oil, gas, and coal subsidies are equivalent to 6.5 percent of global gross domestic product. To put that in perspective, total expenditures for public healthcare worldwide equal 6 percent of global GDP.
Only a small portion of subsidies to the industry and consumers come from direct government support, such as tax credits. The vast majority stems from "externalities," which are public health or environmental costs that aren't included in the price of a gallon of gasoline or a monthly electric bill.
"The environmental damage done by consumption of fossil fuels is really not reflected in the prices that people pay," David Coady, lead author on the paper, told VICE News. "If really these prices were to reflect the true cost to the economy, the taxes should be much higher."
While the push to end fossil fuel subsidies has largely hinged on efforts to reduce greenhouse gas emissions, the IMF found that global impacts, like climate change, only account for only 24 percent of the total cost of market externalities. Seventy percent of the costs, it said, are attributed local impacts, such as deaths and injuries due to inhaling polluted air or car accidents.
"Not charging for pollution is definitely a form of subsidy," Adele Morris, policy director of the Climate and Energy Economics Project at the Brookings Institution, told VICE News. "It's saying that no matter how much carbon dioxide somebody pumps into the atmosphere, we're not going to charge them at all, even though there's clear evidence this is creating a threat to disrupt the Earth's climate."
The two biggest subsidizers of the fossil fuel industry says the IMF are also the two largest emitters of greenhouse gases: China and the United States. China accounts for $2.3 trillion worth of subsidies, while the United States subsidizes the industry to the tune of $699 billion.
The $5.3 trillion price tag is up from its previous estimate of $4.9 trillion in 2013, largely due to better data on how air pollution affects public health. In November, the International Energy Agency, the world's energy watchdog group, pegged the global total at $548 billion for 2013.
Steve Kretzmann, Executive Director of Oil Change International, told VICE News it's "ridiculous" that governments continue to subsidize fossil fuel production and consumption.
As an example of America's out of date support for the industry, Kretzmann points to a tax credit known as the intangible drilling costs deduction, which was created in 1913 to alleviate the risk of the then-fledgling venture of drilling for oil. The credit allows companies to immediately deduct drilling related expenses, like labor and repairs, before any resources are even extracted from the ground. Normally, corporations deduct expenses once they report profits.
The intangible drilling costs deduction alone cost the US government $3.5 billion in 2013, according to an OCI report.
Encouraging the burning of fossil fuels, Kretzmann said, is equivalent to denying global warming.
"There's a clear relationship here between these subsidies and increased production," Kretzmann told VICE News. "A lot of people think increased American energy production is not necessarily a bad thing. But at this stage in the game, it's climate denial and it's not something that should be included."
The IMF report comes just six months ahead of UN climate change negotiations in Paris at the end of the year. Diplomats aim to secure a global agreement on keeping global warming within 2 degrees Celsius (3.6 degrees Fahrenheit) above pre-industrial levels.
At the 2009 G20 summit in Pittsburgh, Pennsylvania, President Obama led the charge in adopting a joint statement on ending fossil fuels.
"We commit to rationalize and phase out over the medium term inefficient fossil fuel subsidies that encourage wasteful consumption," said the statement.
Follow Laura Dattaro on Twitter: @ldattaro