Planning or Chaos: roadmaps for fair and funded fossil fuel phaseouts in producing countries
Oil Change International’s new analysis outlines how fossil fuel producing countries are impacted by the volatility of a global economy running on fossil fuels, and makes the case for these countries to develop credible government-led roadmaps to plan for a world of declining demand for their products.
The current worst-in-history energy crisis has exposed the inherent volatility of a global economy still running on fossil fuels. It is causing tremendous social and economic pain around the world, even in fossil fuel producing countries. On top of the already evident climate case, the economic and security case for countries to switch to renewable energy and electrify their economy has never been clearer and more urgent. This is a wake up call for fossil fuel producing countries: if they do not plan their transition away from fossil fuel dependence now, they risk facing social, economic, and political chaos alongside climate breakdown.
The Oil Change International analysis argues that fossil fuel producing countries cannot afford to keep waiting for these changes to unfold. They need credible, government-led roadmaps that provide a clear direction for their economies, identify the sectors they want to develop, establish how the transition will be financed, and address the systemic barriers that currently lock countries into fossil fuel dependence.
Governments are the only actors that can deliver a just and planned transition. Our current situation is the result of decades of market-led policies that have failed to lower the global economy’s deep dependence on fossil fuels. Producing countries that heavily depend on fossil fuel revenues need credible long-term roadmaps to kickstart their transition.
The briefing outlines four essential components of credible, government-led energy transition roadmaps for fossil fuel producing countries:
- Set a long-term vision for the country’s energy and economy with clear targets and trajectories;
- Seek to grow non-fossil fuel sectors through industrial policy and planning;
- Unlock fiscal space for the transition; and
- Identify and tackle systemic barriers to transition, including by championing international economic and financial reforms, and supporting international cooperation for a just and equitable phase out. In the near term, a number of policies can be implemented domestically, or supported at the international level, to kickstart this transition journey.