The level of energy subsidy for any economy is clearly inversely related to the consumption of coal (and lignite) used in electricity production. Given the potential welfare gains and improvement to competitiveness, as well as the reduced strain on public finances that could be derived from removing these subsidies, subsidy reform is a strong motivation for diversifying energy sources, specifically towards renewables. However it is undeniably a difficult policy choice which requires strong political support and the willingness to take a long-term view.