G20 governments still spending more on fossil fuels: Study

In most countries assessed, the progress made during the last three years was described by experts as "poor" or "very poor," and no country was considered to have made "good progress" 
Representative image
Representative image

Despite repeated pledges to end inefficient fossil fuel subsidies, G20 governments' support to fossil fuels has dropped by only nine per cent since 2014-2016, hitting $584 billion annually over the last three years, a report by international researchers said on Tuesday. This marginal progress will likely be undone this year by billions of dollars committed to fossil fuels in response to Covid-19, said the report by the International Institute for Sustainable Development (IISD), the Overseas Development Institute (ODI), and Oil Change International (OCI).

"G20 governments were already not on track to meet their Paris Agreement commitments on ending public support for fossil fuels before Covid-19," said Anna Geddes of IISD, lead author of the report 'Doubling Back and Doubling Down: G20 Scorecard on Fossil Fuel Funding'. "Now, disappointingly they are moving in the opposite direction. G20 funds for fossil fuels are likely on course to remain constant or even trend upwards again in 2020 compared to the last few years where we've seen a slight drop in support."

According to the latest data from the Energy Policy Tracker, G20 governments have given at least $233 billion in additional support through recovery measures to fossil fuel-intensive sectors since the pandemic began. "In Doubling Back and Doubling Down", researchers considered recent COVID-19 recovery commitments as well as pre-pandemic policies to rank G20 countries' progress in phasing out support to fossil fuels.

They looked at seven indicators: transparency, pledges, public money for coal, oil and gas, fossil fuel-based power (both production and consumption), as well as how support has changed over time. In most countries assessed, the progress made during the last three years was described by experts as "poor" or "very poor," and no country was considered to have made "good progress" in line with reaching Paris Agreement goals.

Among the G20 Organisation for Economic Co-operation and Development (OECD) members, Germany performed best overall in terms of phasing out fossil fuel funding, while Mexico, Turkey, and the UK ranked equally lowest. Out of the non-OECD G20 countries, Brazil scored highest while Saudi Arabia came in last. Top scorer Germany got points for transparency, strong commitments, and relatively lower support for oil and gas production and fossil fuel use. The country's overall support to fossil fuels dropped 35 per cent relative to 2014-2016.

Brazil's relatively good performance was tied to low support for coal production, fossil fuel-based power and consumption, and a reduction in state-owned enterprise investment in fossils. "However, new measures under consideration could soon reverse this progress," Geddes said.

On the other end of the spectrum, the UK and Turkey rank poorly due to a lack of transparency and large subsidies for fossil fuel use, while Mexico was docked for heavy support for oil and gas production and fossil fuel-based power. Saudi Arabia also continues to heavily support oil and gas production and fossil fuel-based power, mostly through large state-owned enterprise expenditures and low consumer energy prices, said the report.

"No G20 country is performing as it should, but there are some examples that could be followed," said Angela Picciariello of the ODI. "A true leader would mirror Germany's transparency and strong pledges and go a step further than Italy with a plan to rapidly phase out not only support for coal but also oil and gas. To be in line with 1.5 degrees Celsius and avoid the worst of the climate crisis, G20 governments should rule out any continued fossil fuel support, in recovery spending or otherwise."

Although this report and other recent data on public Covid-19 commitments indicate that the already slow progress on phasing out fossil fuel funding has now been thrown into reverse, researchers say there are upcoming opportunities for governments to turn the tide. "China, Japan, and South Korea's recently announced net-zero emissions plans and the EU's Green Deal initiative indicate that there is momentum to increase ambition and demonstrate a commitment to climate action," believed Geddes.

"The current Finance in Common summit, the G20 summit on November 28 and the Paris Agreement's fifth anniversary in December are chances to build on these. Although the last three years have shown a lack of progress from governments, we can make the next three years a turning point."

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