Phasing Out Diesel Subsidies in Colombia: A Social Contract Perspective on Stakeholder Consultations

The phase-out of fossil fuel subsidies represents one of the most politically sensitive and contested policy challenges in climate action. In countries where fuel subsidies form an integral part of the social contract between the state and society, removing these subsidies requires navigating complex political, economic, and social dynamics.

A new study by Mauricio Böhl Gutierrez published in Energy Research & Social Science examines Colombia’s phase-out of diesel subsidies through a qualitative case study, drawing on 32 interviews with stakeholders from government, transport, business, academia, and civil society. The research uses the social contract as an analytical framework to examine actors’ perceptions of the phase-out process, with a specific focus on the government’s responsibilities under the 3Ps of the social contract: Provision, Participation, and Protection.

The Social Contract Framework: 3Ps Analysis

The study applies a social contract perspective to understand how stakeholders perceive the government’s role in replacing diesel subsidies:

Provision: Subsidies as Essential State Support

Stakeholders from the passenger and freight transport subsectors view subsidies as an essential Provision within the social contract, particularly in a context of perceived institutional inefficiency and low trust in government capacity. The government’s offer to substitute diesel subsidies with alternative Provisions—such as new technologies in the long term—conflicts with the immediate Protection challenges faced by the sector.

This tension highlights a critical challenge: long-term technological transitions cannot immediately replace immediate economic protections that stakeholders have come to expect as part of the social contract.

Participation: Inclusive Consultation and Clientelism

The study reveals clientelist structures in Colombia, raising important questions about the extent to which other societal groups are involved in the process (Participation) and would require support through mitigation policies (Provision). This finding underscores the importance of ensuring that consultation processes are truly inclusive and not dominated by particular interest groups.

Protection: Immediate Challenges vs. Long-term Vision

The government’s vision for structural reform through new technologies conflicts with the sector’s immediate Protection challenges. To phase out subsidies successfully, the government would need to address the sector’s priorities to build trust in its vision for a structural reform and to tackle deep-rooted, structural vulnerabilities in the subsectors that exacerbate dependence on fossil fuels.

Key Findings: Trust, Consultation, and Structural Reform

The research identifies three critical factors for securing public support for subsidy phase-outs:

1. Trust-building: Establishing credibility and demonstrating government capacity to deliver on alternative provisions
2. Inclusive consultation: Ensuring genuine participation of all affected stakeholders, not just powerful interest groups
3. Structural sector reforms: Addressing underlying vulnerabilities that create dependence on fossil fuels

Implications for Fossil Fuel Subsidy Reform

The study’s findings have broader implications for fossil fuel subsidy reform globally:

• Subsidies as social contract elements: In many countries, fuel subsidies are not just economic tools but integral parts of the social contract, making their removal politically sensitive
• Trust deficit challenges: Low trust in government capacity can undermine support for subsidy phase-outs, even when alternatives are proposed
• Consultation quality matters: The inclusiveness and authenticity of stakeholder consultations are critical for building support
• Structural vulnerabilities: Simply removing subsidies without addressing underlying structural issues in affected sectors can create resistance and undermine reform efforts

The Colombian Context: Transport Sector Dependencies

The research focuses specifically on Colombia’s passenger and freight transport subsectors, which have developed deep dependencies on diesel subsidies. These dependencies are not merely economic but are embedded in structural vulnerabilities that make the sector particularly resistant to subsidy removal.

The study highlights how immediate economic protection needs conflict with long-term transition visions, creating a challenge for policymakers seeking to phase out subsidies while maintaining social contract legitimacy.

Lessons for Global Subsidy Reform

This research offers valuable lessons for countries worldwide seeking to phase out fossil fuel subsidies:

• Understand the social contract: Recognize that subsidies may be perceived as essential state provisions, not just economic tools
• Build trust first: Establish government credibility and capacity before proposing subsidy removal
• Ensure genuine participation: Create inclusive consultation processes that engage all affected stakeholders, not just powerful groups
• Address structural issues: Tackle underlying vulnerabilities that create dependence on fossil fuels
• Balance immediate and long-term needs: Acknowledge immediate protection challenges while building support for long-term transitions

Research Methodology

The study employs a qualitative case study approach, conducting 32 in-depth interviews with stakeholders representing diverse perspectives:

• Government officials
• Transport sector representatives (passenger and freight)
• Business associations
• Academic researchers
• Civil society organizations

This multi-stakeholder approach provides a comprehensive view of how different actors perceive the subsidy phase-out process and their expectations of the social contract.

Conclusion: Rethinking Subsidy Phase-Outs Through Social Contracts

The research by Mauricio Böhl Gutierrez demonstrates that successful fossil fuel subsidy phase-outs require more than economic analysis and policy design. They demand a deep understanding of the social contract dynamics that underpin subsidy systems, genuine efforts to build trust and ensure inclusive participation, and structural reforms that address the root causes of fossil fuel dependence.

As countries worldwide grapple with the challenge of phasing out fossil fuel subsidies in the context of climate action, this research provides critical insights into the political and social dimensions that often determine success or failure of these reforms.

The study underscores that subsidy reform is fundamentally about renegotiating the social contract—a process that requires trust, participation, and structural change, not just policy change.

Read the Full Paper

Read the full paper on ScienceDirect

Citation:
Böhl Gutierrez, M. (2026). Phasing out diesel subsidies in Colombia: A social contract perspective on stakeholder consultations. Energy Research & Social Science, 132, 104542. https://doi.org/10.1016/j.erss.2026.104542

Keywords: Social contract, Fossil fuel subsidy reform, Transport, Trust in government, Sector reform, Stakeholder consultation