The German Government is set to break a major international climate commitment, releasing a draft policy today for Euler Hermes, the German export credit agency, which allows the agency’s huge international fossil fuel financing to continue.
Rather than match the international policy, today’s announcement leaves the door open indefinitely to domestic public finance for oil and gas, only committing to “announce by fall 2024 the implementation plan” to phase out these flows.
Earlier this week a coalition of 150+ economists and policy experts including Yanis Varoufakis, Jason Hickel, Olúfémi O. Táíwò, Nader Habibi, and Isabelle Ferreras sent a letter to Global North leaders, calling on them to pay their fair share for a just energy transition with trillions in public reparations, and to allow democratic and people-centred reforms to the global financial system they have a disproportionate control over.
Next week, the U.S. International Development Finance Corporation is likely to consider a $500 million guarantee to help Polish oil and gas company PKN Orlen increase its imports of U.S. LNG, violating Biden’s commitment to end public finance for fossil fuels by the end of 2022.
New research shows that Organisation for Economic Co-operation and Development (OECD) countries supported fossil fuel exports by an average of USD 41 billion from 2018-2020, almost five times more than clean energy exports ($8.5 billion).
“At a time when we rapidly need to phase out fossil fuels, this year’s G7 host has pushed for the expansion of gas and LNG and technologies that would prolong the use of coal,” said Susanne Wong, Asia Program Manager.
“Biden’s claims to be a climate leader are increasingly laughable after EXIM’s approval of this refinery. If he can’t be trusted to keep this relatively modest promise, how can anyone trust the United States to live up to its even grander climate promises?” asked Adam McGibbon.
There have been few concrete developments on the G7-led ‘evolution roadmap’ and a new Paris Alignment ‘sector note on energy and extractives’ keeps all existing pathways for WBG fossil gas support open.
Yesterday, the message from the world’s leading climate scientists was their most brutal and stark yet. It was unequivocal.
Last week, OECD countries failed to conclude negotiations on climate friendly incentives to align Export Credit Agencies, the world’s largest international financiers of fossil fuels, with international climate goals.