Press Release

France joins commitment to end international oil, gas, and coal finance by 2022

November 12, 2021

FOR IMMEDIATE RELEASE

November 12, 2021

Contact:
Lorette Philippot, Les Amis de la Terre (France), lorette.philippot@amisdelaterre.org
Armelle Le Comte, Oxfam France, alecomte@oxfamfrance.org
Laurie van der Burg, Oil Change International, laurie@priceofoil.org

France joins commitment to end international oil, gas, and coal finance by 2022
GLASGOW — Last Thursday on November 4, a group of countries and institutions committed to end international public finance for unabated oil, gas, and coal by the end of 2022 at the United Nations climate conference in Scotland (COP26). Since then new countries have been added on a daily basis. There are now 34 signatories and counting and the annual average of potential public finance shifted out of fossil fuels and into clean energy to at least USD 24.1 billion per year. This equals 38% of annual public finance for fossil fuels provided by G20 countries and the Multilateral Development Banks (MDBs) between 2018 and 2020.

Today’s announcement comes after the Netherlands, Germany and Spain confirmed their participation in the initiative earlier this week and alongside confirmations from Belgium and Sri Lanka today. The French development bank — AFD — had already signed up to the statement, but not the French government as a whole. Today’s announcement means that all French public finance institutions, including the export credit agencies (Bpifrance Assurance Export), responsible for EUR 9.3 billion in public finance for oil and gas between 2009 and 2019, will need to end this financing, including for gas projects, by the end of 2022. This significantly brings forward the previously adopted end date for public finance for gas of 2035.

The combination of big polluters and low-income countries signing the statement challenges the assumption that developing country signatories want or need investments in fossil fuels to achieve their development objectives. Alongside fulfilling the stated goal of “prioriti[zing] support fully towards the clean energy transition”, campaigners remind the French government that the ability of this initiative to support a just and 1.5°C-aligned global energy transition will also hinge on avoiding loopholes allowing for a dash for gas, acting on debt relief, increasing grant-based climate finance, and securing a growing number of signatories to the statement.

This would also help raise pressure on the countries that are lagging behind. Laggards include Japan ($10.9 bn/yr), Korea ($10.6 bn/yr), and China ($7.6 bn/yr), which are the largest providers of international public fossil fuel finance in the G20 and together account for 46% of G20 and MDB finance for fossil fuels. The European Bank for Reconstruction and Development (EBRD), one of the biggest EU fossil fuel financiers, is also missing.

Shifting public finance for energy out of all fossil fuels and into clean energy is an urgent task. The International Energy Agency (IEA) says that to limit global warming to 1.5°C, 2021 needs to mark the end of new investments in not just coal, but also new oil and gas supply. After a wave of commitments to end international coal finance this year, last week’s commitment is the first international political commitment that also addresses public finance for oil and gas.

Quotes:

Lorette Philippot, Finance Campaigner at Friends of the Earth France, said:
“The French government finally succumbs to diplomatic and civil society pressure. It is a crucial win after years of mobilization against climate-wrecking subsidies to fossil fuels overseas. The devil will now be in the details, and we will carefully monitor the implementation of this commitment. We expect Emmanuel Macron to take decisions in the very short term and urge him to immediately and publicly refuse any support to Total’s gas project in the Arctic, currently under consideration for financing.”

Armelle Le Comte, Advocacy Manager on Climate at Oxfam France, said:
“At last! It took no less than two years for France to implement the commitments made by Emmanuel Macron at the UN in September 2019. Faced with growing international pressure at COP26, France had become completely isolated and had no other choice. This victory has been made possible by the active mobilization of civil society for several years.”

Laurie van der Burg, Global Public Finance Campaign Co-Manager at Oil Change International said:
“It is great to hear that France today joined the commitment to end international public finance for oil, gas and coal by the end of 2022. This means that it will have to stop financing dirty gas projects too. The science is clear that expanding gas infrastructure is incompatible with limiting global heating to 1.5°C. The violence that has erupted linked to the gas projects in Mozambique, supported with French public finance, shows that in addition to wrecking the climate, these projects wreck local communities.”

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Notes:

The joint statement was launched at the UK pavilion at 10.30 GMT 4 November 2021.

The countries and the institutions that have signed the joint statement include: Agence Française de Développement (AFD), Albania, Canada, Costa Rica, Denmark, Banco de Desenvolvimento de Minas Gerais (BDMG), The East African Development Bank (EADB), El Salvador, Ethiopia, Fiji, Finland, Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO), France, Germany, Mali, Marshall Islands, New Zealand, Moldova, Portugal, Slovenia, South Sudan, Spain, Sri Lanka, Switzerland, the European Investment Bank, The Gambia, The United Kingdom, The United States and Zambia.

The estimate of a direct $24.1 billion shift is based on annual average international public finance for fossil fuels from the participating countries and institutions from 2016-2020. Data for Germany, Italy, AFD, Canada, EIB, the United Kingdom and the United States are from Oil Change International’s Shift the Subsidies Database. Data for Denmark, Finland and Sweden is taken directly from government reporting. No data was available for other donor signatories. Due to incomplete reporting, this is likely an underestimate.

“Past Last Call” is OCI and Friends of the Earth US’s latest briefing analyzing G20 public finance figures and trends. It shows that between 2018 and 2020 G20 governments and public finance institutions provided at least USD 188 billion in public finance for fossil fuels.

In September 2021, 200+ CSOs launched a statement calling on world leaders to end public finance for fossil fuels in 2021 and launch a joint commitment to do so at COP26.

In June 2021, 100+ Economists called on the G7 to put an end to not only coal finance, but also oil and gas finance in 2021.

A legal opinion by Professor Jorge E Viñuales from the University of Cambridge and Barrister Kate Cook of Matrix Chambers argues that governments and public finance institutions that continue to finance fossil fuel infrastructure are potentially at risk of climate litigation.

A comment piece by Harro van Asselt, professor at University of Eastern-Finland Law School and affiliated researcher at Stockholm Environment Institute, and Gita Parihar, an environmental advocate and in-house consultant for environmental NGOs and the UN, and a board member of the Climate Justice Fund, suggests that the ruling in the Shell court case should be a wake-up call for governments to end fossil fuel support.

In October in the lead up to COP26, a global group of campaigners organized Climate Debt Justice Days of Action calling on governments and lenders to take decisive action to address the debt problem in the global south and to provide grants, not loans in order to free up resources to enable countries to respond to the climate crisis.