PUBLIC FINANCE
Governments are still spending billions subsidizing oil, gas and coal. We need to #StopFundingFossils and start investing in the future.
OVERVIEW OF WORK
Since the Paris Agreement, G20 governments have continued to finance more than USD 77 billion dollars annually in fossil fuels through multilateral development banks (MDBs), bilateral development finance institutions (DFIs), and export credit agencies (ECAs). This is three times the support they provide to clean energy. Beyond providing this direct monetary backing, these institutions reduce perceived risk and provide a government stamp of approval on fossil fuel projects that often serves to crowd in private finance. While recently the level of fossil fuel support has started to drop, institutional policies to exclude fossil fuel finance are needed to ensure this progress continues.
While a number of public finance institutions committed to ending coal finance in the early 2010s, it wasn’t until 2017, following years of campaign pressure by Oil Change and others, that the World Bank made a meaningful commitment to stop financing for upstream oil and gas. Following an intense campaign effort, in 2019 the European Investment Bank committed to ending nearly all oil, gas and coal finance. Recently, the UK announced it would end overseas oil and gas finance, and the EU and US, among others, have signalled that they intend to follow suit. Building off these successes, OCI is now working to secure further commitments from governments and public finance institutions on ending public finance for fossil fuels.
LATEST PROGRAM POSTS
La Banque Postale, which is a relatively small but progressive bank in France, has set an international precedent against oil and gas expansion. The bank, which was already committed to ensuring that its banking activities achieve net zero carbon emissions by 2040, announced a complete withdrawal from fossil fuels by the 2030. Will other banks now follow?
As hundreds are arrested outside the White House demanding urgent action on our climate emergency, the World Health Organization has described climate change as the "single biggest health threat facing humanity," and called on governments and policymakers to "act with urgency" on the climate and health crises.
As churches, colleges and companies increasingly pull out from investing in oil and gas, under pressure from the climate movement, secretive hedge funds are betting on climate chaos, planning on making millions of dollars in the process.
Under pressure from civil society, eleven banks have now confirmed that they will no longer fund the controversial East African Crude Oil Pipeline.
LATEST PROGRAM RESEARCH
The COVID-19 crisis poses a threat to people's health, their jobs and their lives, and like all crises, exacerbates already existing inequalities. Trillions in public finance will be needed to get through the current pandemic. This briefing outlines why continuing to rely on fossil fuels, in particular oil and gas, is not compatible with long-term recovery. It does not make sense to use the COVID-19 stimulus packages to try to revive a sunsetting industry which will not deliver on economic recovery, only to shut it down a few years later to meet climate goals.
The European Investment Bank (EIB) is the world’s largest multilateral lender, bigger even than the World Bank. As a public bank, it’s tasked with providing finance in the EU public interest, and it has an outsized influence on the EU’s energy system because of the private investment it can “crowd in” and the sheer amount of money it has at its disposal.
A new analysis released today highlights how European Investment Bank (EIB) financing of fossil fuel projects – in particular gas pipelines and LNG terminals – is not compatible with EU climate commitments or the aims of the Paris Agreement.