G20 leaders first pledged to end fossil fuel subsidies back in 2009. Almost six years later, and despite reiterating that vow each and every year, they have precious little to show for it. Annually, G20 countries still spend at least $88 billion in public money on fossil fuel exploration alone, and spend hundreds of billions more on fossil fuel production.
So how can G20 leaders go from broken records to honest brokers? November’s G20 summit is the last big chance for world leaders to signal their commitment to decisive action on climate change ahead of crucial climate change negotiations in Paris this December. G20 finance ministers will meet in Ankara, Turkey, later this week to lay the groundwork for the November G20 summit, and 65 organizations big and small – from across the world – sent a letter to those ministers urging three key actions to end fossil fuel subsidies and scale up climate finance:
- Honour the 2009 commitment by G20 leaders to phase out fossil fuel subsidies
The Turkish G20 Presidency has optimistically billed 2015 the “year of implementation.” In that spirit, G20 finance ministers and leaders should start with a concrete, timebound commitment to stop funding fossils, as a step on the path to implementing their six year-old pledge.
The process can kick off with an agreement to immediately eliminate all subsidies for fossil fuel exploration, since the best science tells us that the vast majority of already-proven reserves must stay in the ground if we hope to have a shot at avoiding the worst impacts of climate change. Unless we ignore what science is telling us, governments have no business funding exploration for new reserves using public money.
Leaders should also adopt a clear and strict timeline to equitably phase out fossil fuel subsidies, with a reporting framework and milestones that ensure transparency and enable adequate monitoring of countries’ progress toward meeting the timeline.
End public finance for coal projects
Coal is a dirty, last-century energy source. Combustion of coal is responsible for over 40% of global greenhouse gas emissions, and the IMF estimates that local pollution from fossil fuels will do more than $2.7 trillion in damage in 2015, with most of that stemming from coal-fired power emissions.
Despite the social and human toll of coal, public institutions provided $73 billion in finance for coal projects between 2007 and 2014, with the vast majority of this finance coming from G20 governments. This public support is an extremely important source of finance for coal, and serves to prop up an industry whose time has come and gone. G20 leaders need to commit to ending public finance for coal immediately, except in extreme cases where there is clearly no other viable option for increasing energy access to the poor.
Make good on delivering more finance to support climate action.
What to do with that big pile of public cash freed up from the phase-out of fossil fuel subsidies? Since fossil fuel subsidies have helped drive climate change, putting a chunk of those newfound resources toward support for climate change mitigation and resilience-building efforts would make a lot of sense. The Turkish G20 Presidency has highlighted climate finance as one of its priorities for 2015, and G20 finance ministers have the opportunity to get two wins for the price of one action: phasing out fossil fuel subsidies and increasing efforts to scale up climate finance can be two sides of the same coin. Scaling up climate finance while winding down fossil fuel subsidies would send a powerful message to all world leaders – not just the G20 – toward the Paris climate change negotiations.
G20 countries are running out of time to deliver on their 2009 pledge to phase out fossil fuel subsidies. If they delay much longer, leaders’ credibility may be on the line. At this week’s meetings of G20 finance ministers, it’s important the groundwork is laid for real action on fossil fuel subsidies at the G20 leaders’ summit in November.