The most powerful countries in the world keep ratcheting up public funding for fossil fuel projects and increasing emissions — despite the fact that continued investment in dirty fuels could push us beyond the warming targets laid out in the Paris Agreement.
Last year, the G20, which is composed of 19 of the world’s wealthiest countries and the European Union, ramped up funding for dirty fuels by a stunning 29%, a new report shows. In total, members of the G20 put $US190 ($264) billion of public money toward fossil fuel projects.
“Too much public finance for energy in the G20 is still skewed towards the fossil fuel industry,” Ipek Gençsü, a research fellow at the Overseas Development Institute and one of the lead authors of the report, said in a statement.
The Climate Transparency report, released last week, is authored by a group of international partners that keep track of international climate finance. This version is the eighth annual report of its kind, and it illustrates the bumpy trajectory the world’s wealthiest governments are taking in continuing to prop up dirty fuels.
In 2020, public investment in fossil fuel projects from countries in the G20 dropped to $US147 ($204) billion — still quite a bit of cash but a dip from the year before. Unfortunately, that funding rose once again last year by a whopping $US64 ($89) billion. The numbers in this report were calculated before the Russian invasion of Ukraine in March; the report’s authors say that the funding increase has almost certainly continued into this year, given the global energy crisis and skyrocketing cost of fossil fuels.
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And all this investment in fossil fuels comes with an accompanying rise in emissions: CO2 emissions in G20 countries bounced back nearly 6% last year, with emissions from the power and building sectors reaching pre-pandemic levels. The countries of the G20 are responsible for around three-quarters of the world’s historic emissions; the world’s 46 least developed countries, meanwhile, accounted for just 1.1% of global greenhouse gas emissions from fossil fuel combustion in 2019.
All this money being thrown around in support of dirty energy comes with a hefty side of hypocrisy. In 2009, the G20 pledged to phase out fossil fuel subsidies over the “medium term.” Many of the subsequent meetings made over the past decade-plus have ended in promises to take further climate action. Just last year, G20 members recommitted to “phase out and rationalise” subsidies for fossil fuels by 2025.
“I think we can safely say we are now in that ‘medium term’ and it’s clear the G20 has failed to deliver, instead continuing to use public funds to distort the market in favour of fossil fuels,” Gençsü said in the statement.
As luck would have it, investing in fossil fuels is the exact opposite of what we need right now. A separate report from the International Institute for Sustainable Development released this week finds that there is a “large consensus” across multiple bodies of research confirming that any new oil and gas investments are not compatible with the world staying under 1.5 degrees Celsius of warming above pre-industrial levels, the most aggressive warming limit set by the Paris Agreement. What’s more, the planned $US570 ($791) billion pledged to new fossil fuel developments between now and 2030 could more than fully make up for a funding gap needed to get wind and solar development to where it needs to be to stay below that 1.5-degree threshold.
Using public money for renewable energy rather than fossil fuel interests: sounds like a great idea! Too bad that the world’s most powerful countries seem to be firmly in the grip of dirty energy.