Briefing: Why Congress Must Stop Blocking Climate Progress on International Finance
Oil Change International, Friends of the Earth U.S., Center for Biological Diversity
There is an urgent need to ensure that anti-climate riders stay out of appropriations packages for Fiscal Year 2020. Over the last two decades, the Overseas Private Investment Corporation (OPIC; soon to transform into the U.S. International Development Finance Corporation) and the Export-Import Bank (Ex-Im) have collectively financed tens of billions of dollars in fossil fuel projects abroad. These projects not only worsen climate change and threaten our global ability to meet climate targets, but also cause severe local environmental damage, displace communities, and spawn corruption.
Over the last 20 years, significant regulations have been put in place to limit this fossil fuel finance. OPIC is required by statute to reduce greenhouse gas emissions associated with projects in its portfolio by 30% over 10 years, and 50% over 15 years. This has resulted in OPIC approving significantly fewer fossil fuel projects over the last decade. Ex-Im has also seem progress on this front, as the Obama Administration curbed the agency’s ability to finance most coal plants, which prevented approval of coal projects that were under consideration for funding. While far from perfect, these policies slowed the pace of these agencies’ fossil fuel financing and provided models for other country’s development finance and export credit agencies to follow.
Starting in Fiscal Year 2015, a rider was attached to appropriations legislation weakening enforcement of landmark climate change policies at both the OPIC and Ex-Im — curbing nearly two decades in climate policy progress at those agencies.
Ex-Im recently regained its authority to finance large fossil fuel projects, an authority the agency has not had in nearly four years. Both agencies appear poised to ramp up fossil fuel financing, threatening to reverse a decade of gains at both agencies. Congressional climate leaders must seize this opportunity to ensure that when a final spending bill is sent to Trump, it follows the House and excludes any anti-climate riders.