122 CSOs warn signatory countries they have only six months left to meet COP26 commitment to end international public finance for all fossil fuels
Today, 122 civil society groups are releasing letters to eleven government signatories to the Glasgow Statement on International Public Support for the Clean Energy Transition, laying out the actions they must take as soon as possible to meet their commitment. In this joint statement at COP26, 35 countries and 5 public finance institutions committed to end their international public finance for 'unabated' fossil fuels by the end of 2022, and instead prioritise their "support fully towards the clean energy transition."
Russia's war in Ukraine and fuel price spikes mean international public finance institutions must roll out rapid decarbonization and aid packages, not back track by locking in new fossil infrastructure
The Glasgow Statement has the potential to directly shift at least USD $24 billion a year in influential trade and development finance from governments away from oil, gas, and coal towards the clean energy transition if it is implemented well — and much more if these initial signatories can convince peers to join them and bring their commitment into other multilateral settings like the G7 and OECD.
However, todays' letters to Canada, Germany, Netherlands, Italy, France, Portugal, and New Zealand warn that the initiative will fail to have this transformative impact if initial implementation is late, creates large loopholes for gas or carbon capture, utilisation and storage (CCUS), or is not paired with an exponential increase in public finance for renewable energy. Letters with similar recommendations have already been sent to the United Kingdom and United States, and will be sent this month to Costa Rica and El Salvador.
The warning from civil society comes at the halfway mark for countries to implement their commitment, and right ahead of the G7 where public finance for energy is set to be a key issue. As Russia's war in Ukraine has continued, the United States and Canada have signalled they may backtrack and instead rely on significant loopholes to continue trade finance for fossil gas.
Last month's IPCC Working Group III report was clear that continued fossil fuel finance of any kind is misaligned with the Paris climate goals, and that public finance for fossil fuels in particular plays a key role in determining our global future energy systems. In light of this, civil society groups are also emphasizing the need for wealthy country signatories to prioritize public finance for a just energy transition for low-income countries and communities and to avoid hypocrisy by ending any public finance and other subsidies for fossil fuels they still provide domestically. The letters to Costa Rica and El Salvador also emphasize the role Global South country signatories can play in holding wealthier signatories accountable to these responsibilities.
Bronwen Tucker, Public Finance Campaign Co-Manager, Oil Change International said: "The Glasgow Statement on public finance was a truly exciting break from most multilateral climate agreements because it named both a near-term timeline and concrete actions that signatories would take. But now that we are at the halfway point to implementation, too many signatories are missing vital ingredients for what will be needed for it to have a transformative impact: binding fossil fuel exclusion policies that include gas, clear definitions for CCUS, and meaningful increases in support for a globally just energy transition."
Julia Levin, National Climate Program Manager, Environmental Defence Canada said: "As the largest provider of public finance to oil and gas companies in the G20, Canada's commitments to end subsidies to the sector are critical. But so far, Canada has been dragging its feet on this key climate promise – and has instead created new subsidy and bond programs geared toward false solutions like carbon capture. Oil and gas companies have profited immensely for decades from activities that are fueling the climate crisis and polluting communities' land and water. Public financing should not keep getting funneled to these companies period, no matter where in the world they operate or whether they are promising to lower 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 Statement on public finance was an important step forward. But what is needed is to go beyond words into action, with a sense of urgency and considering the current geopolitical context. In Latin America and the Caribbean (LAC), with only two countries as signatories, the region has a long path ahead with specific political and socio-economic challenges to address. Thus, shifting financial flows of developed countries from fossil fuels to support a just energy transition in LAC and other regions will be key for a global alignment of public finances with climate objectives."
Kate DeAngelis, International Finance Program Manager, Friends of the Earth US said: "President Biden started his presidency with bold statements on the need to end overseas fossil fuel financing, but has spent the past year taking little real action. Rather than using this moment to cave to the oil and gas industry, the Biden-Harris Administration must end US financing for international fossil fuels and promote a sustainable, renewable energy future."
Simone Ogno, Finance and Climate campaigner, ReCommon said: "Italy's dependence on Russian gas has been made possible thanks to public finance, especially SACE, the Italian export credit agency. Public finance is now at risk of driving the country toward new 'bloody' gas suppliers while gas prices stay high and more and more people are forced to choose between a meal and paying their energy bills. It's time for Italy's public finance to play its part and Draghi's government has to clarify how it will implement the Glasgow Statement by pulling SACE out of fossil finance and breaking the country's dependence on fossil fuels once and for all."
Marius Troost, Policy Officer, Both ENDS said: "Signing the Glasgow Statement is one thing, translating it into ambitious policy is another. The science is clear about the need to stop financing fossil fuels and the role public finance plays in this process. It is therefore crucial that the signatories of the Statement, including The Netherlands, follow up on their promises. There can be no room for exceptions and loopholes that water down the commitment."
David Ryfisch, Team Leader International Climate Policy, Germanwatch said: "Fossil energies are risky and create long-term dependencies. This has become painfully clear for many G7 states, particularly Germany, in the last few months. Learning from their own mistakes, all G7 countries should join the Glasgow Statement and stop international investments into fossil fuels and instead accelerate their renewable energy finance."
Anna-Lena Rebaud, Climate and Just Transition campaigner, Friends of the Earth France said: "During his first mandate, Emmanuel Macron has been a master in communication, but has repeatedly failed at ambitious climate action. The climate plan on export finance adopted in 2020 is a good example. After joining the Glasgow Statement, the new government cannot fail again at effectively putting an end to all public support to fossil fuels."
Nicole Rodel, Communications Campaigner, Oil Change International said: "Russia's war in Ukraine and the current fuel prices spikes have prompted some Glasgow Statement signatories to suggest they may backtrack and use their international public finance to lock-in new fossil infrastructure like the East African Crude Oil Pipeline, new import terminals for U.S. LNG, and Equinor's extraction projects in Tanzania and Canada. We cannot afford this. What is desperately needed instead is for global leaders to double down on the Glasgow statement and support rapid decarbonization packages for renewables and energy efficiency in the areas that need it most. The pandemic has shown that governments can rapidly mobilize massive sums of public money. This is the moment to do it, and accelerate the transition to a clean and fair future without fossil-fueled conflict."
Read the letters in full:
- New Zealand
- United Kingdom (November 2021)
- United States (April 2022)
- The $24 billion per year quoted above is 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 the multilateral development banks (MDBs). For non-G20 countries, Oil Change International has used the same methodology to estimate fossil fuel finance totals.
- The countries and the institutions that have signed the joint Glasgow statement on public finance include: 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, The Gambia, The United Kingdom, the United States 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 globally just transition.
- A March 2022 report from BankTrack, Milieudefensie, and Oil Change International found that Global North public finance institutions have backed at least $37 billion for fossil fuels in Africa since the Paris Agreement. Government backing and preferential rates meant this finance has had an outsized impact on private financial flows, pushing forward fossil fuel projects and crowding out renewable alternatives. Meanwhile, poor contract terms, debt traps, and disproportionate ownership by foreign multinationals have meant this finance has undermined development.
- A legal opinion by Professor Jorge E Viñuales from the University of Cambridge and Barrister Kate Cook of Matrix Chambers argues that governments and public finance institutions that continue to finance fossil fuel infrastructure are potentially at risk of climate litigation.
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Both ENDS calls on the government only to provide export credit insurance to sustainable projects that cause no social and/or environmental damage in the countries where they take place.
Almost two-thirds of the export credit insurances that Atradius DSB provided in the 2012-2018 period went to the fossil energy sector. That is contrary to the climate agreements that the Netherlands signed in Paris.
News / 19 May 2022
Both ENDS and 95 other organisations* today sent a letter to State Secretary for Finance Marnix van Rij and Minister for Foreign Trade and Development Cooperation Liesje Schreinemacher calling on them to implement the Glasgow Declaration in full. In this agreement, which the Netherlands and 33 other countries signed at the Glasgow climate conference, the signatory countries pledge to stop all public funding for fossil projects by the end of 2022.
Letter / 4 May 2023
The Dutch government, through its export credit agency Atradius DSB (ADSB), provides export support to companies that undertake activities abroad. The state wants projects it insures to have no negative consequences for people and the environment and therefore sets requirements for corporate social responsibility (CSR). A consultation on CSR policy ran until the end of April, to which a coalition of thirteen social organisations from the Netherlands and abroad, including Both ENDS and Milieudefensie (Friends of the Earth the Netherlands), responded.
Press release / 11 November 2020
Since the signing of the Paris Climate Agreement, rich countries have provided almost 50 times as much export support for fossil fuel related projects as for clean energy projects in four African countries. This is the conclusion of a report written by five environmental organisations from Ghana, Nigeria, Togo and Uganda, in cooperation with Friends of the Earth Netherlands and Both ENDS. The rich countries insured energy projects with a total value of 11 billion US dollars through their export credit agencies (ECAs). More than half of this export support is related to fossil fuels. Only 1% went to sustainable renewable energy.
Publication / 11 November 2020
News / 4 May 2021
Today, two independent experts brought out a legal opinion on the obligations of countries and their export credit agencies under international law in relation to export support for fossil fuels. According to the report, emissions by fossil fuels and the related infrastructure need to be reduced urgently.
News / 28 August 2017
Last June, Both ENDS published a report which showed clearly that, through export credit insurance provider Atradius Dutch State Business (ADSB), the Netherlands is supporting the fossil fuel sector on a large scale. Between 2012 and 2015, ADSB provided billions of euros in insurance and guarantees, on behalf of the State of the Netherlands, to fossil-related export projects. This support is completely out of line with the Paris Climate Agreement. On 20 June, members of parliament Lammert van Raan (PvdD) and Sandra Beckerman (SP) submitted questions to the State Secretaries for Finance and for Infrastructure and the Environment.
External link / 24 August 2022
Both ENDS works with partners worldwide to amplify the voices of communities that are experiencing first-hand the devastating social and environmental impacts of unsustainable financial policies and practices – from climate change to pollution to forced displacement. For more than two decades, we have worked to draw attention to an obscure, yet hugely influential type of financial institution: export credit agencies (ECAs).
News / 30 June 2020
Almost 40 civil society organisations and networks from around the world, including Both ENDS, today sent a letter to Dutch Minister for Foreign Trade and Development Cooperation Sigrid Kaag and State Secretary for Finance Hans Vijlbrief. They are asking the ministers to ensure that the expansion of export credit insurance as a result of the Corona crisis contributes to a green recovery.
News / 21 July 2020
At the end of last week, oil and gas company Total announced that, through its export credit insurer Atradius DSB, the Dutch government is participating in a funding package for a controversial gas extraction project in Mozambique. The project, in which various Dutch and foreign companies are involved, is having a deep impact on the local population and the natural environment in the area. Which Dutch companies the government will be insuring is not yet clear.
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External link / 29 May 2019
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News / 21 December 2021
In Ghana, the effects of climate change are already tangible, just like in many countries around the world. How to ensure that these different experiences are heard and known by the Ghanaian government so that it will take actions that have a positive effect on people and their environment? And how to make local communities aware that they can hold the government accountable - and even have the responsibility to do so? During COP26 in Glasgow we spoke with Kenneth Nana Amoateng (47) and Richard Matey (30). Kenneth works at the AbibiNsroma Foundation, a local NGO, and took it as his mission to advocate for a healthy environment, climate change, and to give young people opportunities. Richard is part of that younger generation and works at the Alliance for Empowering Rural Communities in Ghana.
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News / 6 February 2017
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Press release / 18 November 2019
The Netherlands provides export credit insurances and guarantees worth 1.5 billion euros annually to Dutch companies active in the oil and gas sector abroad. This support amounts to one and a half times the annual amount that the Cabinet of Prime Minister Rutte mobilises for climate initiatives worldwide. The intended effects of Dutch international climate policy are more than offset by this fossil export support. That is the conclusion of a new report from Both ENDS which is published today.