122 CSOs warn signatory countries that they have only 6 months left to meet the COP26 commitment to end international public financing for all fossil fuels
122 civil society organizations publish letters to eleven signatory governments to the Glasgow Declaration on international public support for the clean energy transition, setting out actions they must take as soon as possible to meet their commitment. In this joint statement to COP26, 35 countries and 5 public financial institutions pledged to end their “relentless” international public funding for fossil fuels by the end of 2022, and instead prioritize their “full support” transition to clean energy”.
The Glasgow Declaration has the potential to directly shift at least US$24 billion a year in influential trade and development finance from oil, gas and coal governments to the clean energy transition if implemented well. work – and much more if these first signatories can convince their peers to join them and bring their commitment to other multilateral frameworks such as the G7 and the OECD.
However, today’s letters to Canada, Germany, the Netherlands, Italy, France, Portugal and New Zealand warn that the initiative will not have that impact. transformer if initial implementation is late, creates large gaps for gas or carbon capture, use and storage. (CCUS), or is not accompanied by an exponential increase in public financing for renewable energies. Letters with similar recommendations have already been sent to the UK and the US, and will be sent this month to Costa Rica and El Salvador.
The civil society warning comes half way through for countries to implement their commitment, and just ahead of the G7 where public energy financing is expected to be a key issue. As Russia’s war in Ukraine continues, the United States and Canada have signaled that they may turn back the clock and instead rely on deep loopholes to continue funding the fossil gas trade.
Last month’s IPCC Working Group III report made it clear that continued fossil fuel financing of any kind is not aligned with the Paris climate goals, and public fossil fuel financing in particular plays a key role in determining our future global energy systems. In light of this, civil society groups also stress the need for rich country signatories to prioritize public funding for a just energy transition for low-income countries and communities and to avoid hypocrisy by ending all public funding and other fossil fuel subsidies they still provide nationally. The letters to Costa Rica and El Salvador also highlight the role signatories from the Global South can play in holding wealthier signatories accountable for these responsibilities.
Bronwen Tucker, Co-Head of Crowdfunding Campaign, Oil Change International said“The Glasgow Declaration on Public Finances was a really exciting break from most multilateral climate agreements, as it named both a short-term timetable and concrete actions that signatories would take. But now that we are halfway through implementation, too many signatories are missing the essential ingredients for what will be needed for it to have a transformative impact: binding fossil fuel exclusion policies that include gas, definitions for the CCUS and significant increases in support for a globally just energy transition.
Julia Levin, National Climate Program Manager, Environmental Defense Canada said“As the largest public funder of oil and gas companies in the G20, Canada’s commitments to end subsidies to the sector are essential. But so far, Canada has dragged its feet on this key climate promise — and instead created new grant and bond programs focused on false solutions like carbon capture. Oil and gas companies have profited enormously for decades from activities that fuel the climate crisis and pollute communities’ land and water. Public funding should not continue to be channeled to these companies, no matter where in the world they operate or promise to reduce their emissions.
Diana Cárdenas Monar, General Coordinator, Climate Finance Group for Latin America and the Caribbean (GFLAC) said“In line with Article 2.1c of the Paris Agreement and the need for financial flows to become a driver of the climate agenda and the energy transition, the Glasgow declaration on public finances was a step forward important. But what is needed is to move from words to actions, with a sense of urgency and given the current geopolitical context. In Latin America and the Caribbean (LAC), with only two signatory countries, the region has a long way to go with specific political and socio-economic challenges to overcome. Thus, shifting financial flows from developed countries to fossil fuels to support a just energy transition in LAC and other regions will be essential for a global alignment of public finances with climate goals.
Kate DeAngelis, international fundraising program manager, Friends of the Earth US, said“President Biden began his presidency with bold statements about the need to end foreign fossil fuel funding, but has spent the past year taking little real action. Rather than seizing this moment to give in to the oil and gas industry, the Biden-Harris administration must end US funding of international fossil fuels and promote a sustainable and renewable energy future.
Simone Ogno, finance and climate activist, ReCommon said“Italy’s dependence on Russian gas has been made possible by public finance, including SACE, the Italian export credit agency. Public finances now risk pushing the country into ‘bloody’ new gas suppliers as gas prices remain high and more people are forced to choose between a meal and paying their energy bills . It is time for Italian public finances to play their part and Draghi’s government must clarify how it will implement the Glasgow Declaration by removing SACE from fossil finance and breaking the country’s dependence on fossil fuels once and for all.
Marius Troost, Policy Manager, Both ENDS said“Signing the Glasgow Declaration is one thing, translating it into ambitious policy is another. The science is clear on the need to stop funding fossil fuels and the role that public finance plays in this process. It is therefore crucial that the signatories of the Declaration, including the Netherlands, follow through on their promises. There can be no room for exceptions and loopholes that weaken commitment.
David Ryfisch, Team Leader International Climate Policy, Germanwatch said“Fossil fuels are risky and create long-term dependencies. This has become painfully clear to many G7 states, especially Germany, over the past few months. Learning from their own mistakes, all G7 countries should adhere to the Glasgow Declaration and stop international investment in fossil fuels and instead accelerate their funding for renewable energy.
Anna-Lena Rebaud, climate and just transition activist, Friends of the Earth France said“During his first term, Emmanuel Macron was a master communicator, but repeatedly failed in ambitious climate action. The climate plan on export financing adopted in 2020 is a good example. Having signed on to the Glasgow Declaration, the new government can no longer fail to effectively end all public support for fossil fuels.
Nicole Rodel, Communications Campaign Manager, Oil Change International said“Russia’s war in Ukraine and the current fuel price spikes have prompted some signatories to the Glasgow Declaration to suggest that they could backtrack and use their international public finances to lock in new fossil fuel infrastructure like the crude oil pipeline from East Africa, new import terminals for US LNG, and Equinor’s extraction projects in Tanzania and Canada We can’t afford it. desperately needs instead is for world leaders to double down on the Glasgow Declaration and support rapid decarbonization programs for renewable energy and energy efficiency in areas where it is needed most.The pandemic has shown that governments can quickly mobilize massive sums of public money. Now is the time to do so and accelerate the transition to a clean and just future without conflict. fossil fuel beds.
Read the full letters here
- The $24 billion a year quoted above comes from the open-access Public Finance for Energy Database (energyfinance.org), a project of Oil Change International that tracks financial flows to fossil fuels. and clean energy from G20 bilateral development finance institutions (DFIs), export finance agencies (ECAs) and multilateral development banks (MDBs). For non-G20 countries, Oil Change International used the same methodology to estimate fossil fuel financing totals.
- The countries and institutions that signed the Glasgow joint declaration on public finances are: Agence Française de Développement (AFD), Albania, Canada, Costa Rica, Denmark, Banco de Desenvolvimento de Minas Gerais (BDMG), The East African Development Bank ( EADB ), El Salvador, Ethiopia, Fiji, Finland, Netherlands Development Finance Company (FMO), France, Germany, Mali, Marshall Islands, New Zealand, Moldova, Portugal, Slovenia, South Sudan, Spain, Sri Lanka, Switzerland, the European Investment Bank, Gambia, UK, USA and Zambia.
- An April 2022 briefing from Oil Change International on recent trends in international public finance for fossil fuels, and how these financial flows could be used instead to unlock a just transition globally.
- A March 2022 report by BankTrack, Milieudefensie and Oil Change International found that public financial institutions in the global North have supported at least $37 billion for fossil fuels in Africa since the Paris Agreement. Government support and preferential rates mean that this funding has had an outsized impact on private financial flows, advancing fossil fuel projects and crowding out renewable alternatives. Meanwhile, poor contract terms, debt traps and disproportionate ownership by foreign multinationals have meant that this funding has undermined development.
- A legal opinion by Professor Jorge E Viñuales of the University of Cambridge and lawyer Kate Cook of Matrix Chambers argues that governments and public financial institutions that continue to fund fossil fuel infrastructure are potentially at risk of climate litigation.