The Netherlands breaks major climate promise to end public financing for international fossil fuel projects
Today, a week before the international climate summit in Egypt, the Dutch Government has broken a major climate promise it made last year to end public financing for international fossil fuel projects. International and Dutch NGOs argue that the new policy published by the Dutch Government on restricting finance for fossil fuels has such significant loopholes, that it essentially means The Netherlands has reneged on its promise.
At the UN COP26 climate summit in November 2021, 39 countries and financial institutions, including The Netherlands, signed the Glasgow Statement on International Public Support for the Clean Energy Transition, committing signatories to end their direct international public financing for fossil fuels by the end of 2022, except in exceptional circumstances, and fully prioritize their public finance for the clean energy transition. If all signatories follow through on their pledges with integrity, this will directly shift USD 28 billion a year from fossil fuels to clean energy and help shift even larger sums of public and private money away from investments in climate-harming fossil fuels.
The Dutch policy released today applies to the Dutch export credit agency Atradius Dutch State Business (ADSB). This agency has a long history of Dutch state support for fossil fuel projects abroad. Most recently, from 2018-20, ADSB provided an annual average of USD 1.1 billion to fossil fuels.
No room for fossil fuels
The new policy ends ADSB support for fossil fuel exploration, production, transportation, storage, refining, distribution and power generation. However, it offers a transition period that allows continued support until the end of 2023 for project applications that have come in before the end of 2022, which is in breach of the agreed end of 2022 deadline for new support. The policy also contains exemptions for "energy security" as well as support to the fossil fuel services industry, ports and power generation in low-income countries with extreme levels of energy poverty. Environmental organisations and international observers say that with these wide and ill-defined exemptions in the policy, the Dutch Government has failed to keep its Glasgow promise, putting global climate goals at risk.
Last week, the International Energy Agency published its authoritative World Energy Outlook, which shows coal, oil and gas demand plateauing this decade, and confirms that no investments in new oil and gas fields nor in LNG (liquefied gas) infrastructure can be permitted if the world is to keep to the 1.5C goal of the Paris Agreement. The IEA is clear that investments in energy efficiency and renewable energy are the solution to the current energy crisis, not investments in new oil and gas. It also states, "No one should imagine that Russia's invasion can justify a wave of new oil and gas infrastructure in a world that wants to reach net zero emissions by 2050."
The Netherlands is lagging behind
Unlike the Netherlands, the United Kingdom, Denmark, Sweden, Finland and France have almost completely ended their international support for fossil energy projects. These countries leave no room for exceptions for investments in new gas fields or liquefied natural gas (LNG) infrastructure, showing that pursuing energy security goals can go hand in hand with efforts to end fossil fuel finance. In addition, the French and Swedish development banks completely exclude gas plants from financing.
With the policy released today, environmental organizations say The Netherlands joins a group of laggards who prefer fossil support to a livable future. The environmental organizations are calling on Prime Minister Rutte and Members of Parliament to ensure that the Netherlands still keeps its promise and completely stops supporting fossil projects abroad.
Laurie van der Burg, Co-lead Global Public Finance at Oil Change International:
"This is a huge disappointment. With less than a week until the climate summit in Egypt, Prime Minister Rutte today prioritizes the interests of the fossil fuel industry over a livable future. The science is crystal clear that new investments in fossil energy are incompatible with the goal of staying below 1.5°C warming. The solution to the current energy crisis and the climate crisis are one and the same: a faster transition to cheap, clean and reliable renewable energy."
Niels Hazekamp, Senior Policy Advisor, Both ENDS:
"Climate change is a reality. The floods in Pakistan have already killed a thousand people and caused billions in damage. Through its export support for oil and gas, the Netherlands has contributed to worsening climate change and environmental pollution for decades. The Netherlands had agreed to stop this. The current policy does not. Prime Minister Rutte's COP26 call for 'action-action-action' turns out to be three empty words if this is not remedied."
Samuel Okulony, Environment Governance Institute, Uganda
"The evidence across Africa is clear, no country has managed to develop using fossil fuels. The oil states scattered across the continent are no wealthier, more democratic, or more peaceful than they were without oil. Some are worse off while many have been scarred by decades of civil wars, environmental degradation, grand-astronomic corruption, community conflicts and poor quality of life for the citizens. It's also clear that Climate Change is real and seriously affecting our people, and action must be taken. Africa has an unprecedented opportunity to become a global leader in the Just Energy Transition to clean energy, the energy that will guarantee our future and bring sustainable economic development. I appeal to you to be our advocate for a meaningful switch to clean energy in Africa and the world over."
Kenneth Nana Amoateng, Executive Director at AbibiNsroma Foundation, Ghana:
"Local evidence and science is clear, ending international public finance for fossil fuels and shifting investments into renewable energy that prioritize workers is the way to go. Oil and gas projects have negative impacts on the livelihoods of communities. They resist further expansion of gas. Redirecting huge investments of public finance to renewable energy technologies will support communities to have clean, affordable and modern energy which will ensure energy justice, protect human rights and support sustainable livelihoods."
Charity Migwi, Africa Regional Campaigner, 350 Africa:
"Getting public finance out of fossil fuels is an urgent task. It's time for the Dutch parliament to make the right call to ensure available resources are spent on building a clean and sustainable energy future. This is a historic moment to drive real, transformative change. The Netherlands needs to stick to its promise to cut down all fossil fuel finance and instead provide climate finance to help countries in Africa leapfrog to a renewable energy future. By doing this it will send a strong political signal to other governments to uphold their commitment too."
Read more about this subject
Publication / 15 March 2023
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.
Press release / 29 August 2022
Billions of euros a year in support for fossil exports underscores importance of Glasgow Declaration
Amsterdam, 29 August 2022 - A recent study by Both ENDS shows that, in the past decade, the Dutch government has provided on average a billion euros a year in insurance for fossil energy projects. At the end of last year, together with 33 other countries, the Netherlands agreed to stop providing this support by the end of 2022. Both ENDS calls on the government to formulate a resolute policy that leaves no room for exemptions that contribute to global warming by more than 1.5 degrees.
Press release / 19 May 2022
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."
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 / 20 February 2023
Today, a letter, undersigned by almost 60 organisations from countries that face the consequences of fossil fuel projects or stand in solidarity, has been sent to the Dutch Members of Parliament. This Thursday, a debate about the export credit facility and the policies around it, will take place in the Dutch Parliament. The coalition calls upon Dutch politicians and policy makers to stand up against any form of export support for fossil fuel projects that are to be executed by Dutch companies abroad, expecially in the global South.
News / 15 October 2021
The Dutch export credit agency Atradius DSB is not aligned with the Paris Climate Agreement; on behalf of the Dutch State, it continues to strongly support investments in fossil fuels. This is the conclusion of a report by German research agency Perspectives Climate Research (PCR), in which the export credit agencies of the Netherlands and Japan are measured in terms of their climate ambitions and alignment with the Paris Agreement.
Publication / 29 August 2022
News / 22 November 2021
Export support – and especially that to fossil projects – has been in the spotlights quite often recently. This is a positive development, because the Netherlands alone provides fossil export support worth 1.5 billion euros per year. At the climate summit in Glasgow, the United Kingdom launched a statement promising to stop providing export support to fossil projects by the end of 2022. After having denied at first, the Netherlands decided to join the statement after all – which now has already been signed by nearly forty countries and financial institutions.
Press release / 11 October 2021
New website shines a light on the extent of export credit agencies' support for fossil fuels
Each year governments provide tens of billions of dollars in financial support to fossil fuel projects via export credit agencies (ECAs). Today, 18 civil society groups from 14 countries are launching a new website to shine a spotlight on how ECAs are undermining global climate goals. In advance of the November UN climate conference, the organisations are calling on governments around the world to end public financial support for coal, oil and gas projects, including support from ECAs. Ending this support and redirecting financial resources to sustainable alternatives is essential for a just energy transition.
News / 13 July 2021
The government provides an average of 1.5 billion euros a year in export support for fossil projects by Dutch companies, in the form of insurance and guarantees. The climate crisis requires that the Netherlands and other countries stop providing export support for fossil energy projects, whether it be coal, oil or gas, before the end of this year.
Event / 4 November 2021, 16:45 - 18:00
UNFCCC COP 26 side event ‘Aligning export finance with the Paris Agreement: high time to phase out fossil fuels’
Many countries heavily support fossil fuel investments abroad through their export credit agency (ECA). This contributes to carbon lock- in, whereby companies or even countries commit themselves to a certain amount of greenhouse gas emissions for the lifetime of the infrastructure — oftentimes years or even decades. This seriously delays the transition to renewable energy sources, and is certainly not in line with Art. 2.1c of the Paris Agreement.
Highlighting the impacts caused by export finance in the global South, this side event will provide concrete recommendations to decarbonize export credit agencies.
Publication / 17 November 2019
Letter / 30 September 2022
Last year at COP26, the Netherlands, alongside 38 other governments and institutions, committed to the Glasgow Statement on International Public Support for the Clean Energy Transition. By signing this statement, the Netherlands has committed to ending new direct public support for the international unabated fossil fuel energy sector by the end of 2022- a commitment it has yet to deliver.
With this letter, 20 civil society organisations call on the Netherlands to announce its implementation policies for the Glasgow Statement ahead of the Export Finance for Future (E3F) Summit on the 3 November. The E3F Summit is a critical opportunity for the Netherlands to uphold the commitments made in Glasgow last year, alongside all other E3F members.
The recent E3F transparency report highlighted that Netherlands insured 6x more fossil fuel transactions than renewables from 2015-2020, with 3 billion EUR in fossil fuel transactions compared to only 0.5 billion EUR in renewables. This demonstrates that a fossil-fuel exclusion policy for Dutch export support is urgent, and essential, to align the Netherlands with its Glasgow commitment and the Paris Agreement.
News / 15 April 2021
On Wednesday, April 14, seven countries, including the Netherlands, launched an initiative called Export Finance for Future (E3F), in which they set a number of ambitions with regard to phasing out export support for the fossil sector. Many NGOs worldwide, including Both ENDS in the Netherlands, have been calling for such an initiative in recent years and we are therefore pleased with this step. However, to achieve results and contribute to the Paris climate goals, countries will have to commit to much more ambitious goals than those now set. Concerned civil society organizations, including Both ENDS, therefore prepared a statement detailing the weaknesses they felt in the policy proposed by E3F, supplemented with recommendations for improvements.
News / 8 November 2021
Today, the Netherlands announced that it will join a leading group of countries, including the United States, Canada and Italy, which declared that they would stop international support for fossil energy projects. At the day of the launch of the declaration at the climate summit in Glasgow on the 4th of November, the Netherlands had no intention of joining, but because of pressure from civil society and political parties, the responsible ministries decided to sign after all. Both ENDS, together with organizations at home and abroad, has been pushing for this for years, and we are very happy with this step. We will of course continue to monitor developments.
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.
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.
Publication / 17 February 2022
Letter / 15 December 2022
In October this year, the Dutch government published a policy to implement the COP26 statement in which it promised to stop public finance for fossil fuel projects abroad by the end of 2022 . In spite of this pledge, the Netherlands is considering granting an export credit insurance to a floating production storage and offloading (FPSO) vessel that will be used to produce oil and fossil gas in Brazil for a period of 30 years.