Press Release

Italy’s SACE breaks climate promise with $500 million guarantee for Peru oil refinery

July 11, 2023

Italy’s export credit agency SACE has approved a $500 million guarantee in loans for the Talara oil refinery in Peru, once again breaking their commitment to end their international public finance for fossil fuels by the end of 2022.

FOR IMMEDIATE RELEASE

Contact:

Nicole Rodel, Oil Change International, nicole@priceofoil.org

Italy’s SACE breaks climate promise with $500 million guarantee for Peru oil refinery
11 July 2023 – Italy’s export credit agency SACE has approved a $500 million guarantee in loans for the Talara oil refinery in Peru, once again breaking their commitment to end their international public finance for fossil fuels by the end of 2022.

SACE is the biggest public financier of fossil fuels in Europe. Between 2016 and 2021, SACE supported EUR 13.7 billion in fossil fuels. A study by Oil Change International last year revealed that SACE is considering financing for international fossil fuel projects with emissions equivalent to more than 3 times Italy’s entire annual emissions.

In response, Adam McGibbon, Public Finance Strategist at Oil Change International said:

“Italy continues to break its promises. Rather than using public money to support a just energy transition to renewables as promised, they are pouring more fuel on the fire by funding this climate wrecking project. This move maintains SACE’s position as Europe’s largest fossil fuel financier, denies the IPCC’s ‘final warning’, and makes Italy a rogue state in Europe when it comes to climate change.

Other countries have kept their promise to end international public finance for fossil fuels. This is already shifting billions of dollars towards clean energy, and there needs to be accountability for signatories such as Italy for going back on their word.”

###
Notes:

At the UN COP26 climate summit in 2021, 39 countries and financial institutions, including Italy, signed the Glasgow Statement, committing signatories to end their direct international public financing for fossil fuels by the end of 2022, except in exceptional circumstances, and fully prioritize their public finance for the clean energy transition. A recent Oil Change International study showed that this commitment is already shifting USD 5.7 billion a year from fossil fuels to clean energy. If all signatories meet their commitments, this will increase to USD 37 billion per year, a sum large enough to close the energy access finance gap estimated at USD 35 billion a year.

Oil Change International has compiled this implementation tracker that outlines country-level progress on implementation of the Glasgow Statement, which will be updated in the lead up to COP28.

Oil Change International’s Public Finance for Energy Database shows that G20 countries and the major multilateral development banks (MDBs) provided at least USD 63 billion per year in international public finance for oil, gas, and coal projects between 2018 and 2020. This is 2.5 more than their support for renewable energy.

In its latest report, the IPCC highlighted public finance for fossil fuels as ‘severely misaligned’ with reaching the Paris goals, but that, if shifted, it could play a critical role in closing the mitigation finance gap, enabling emission reductions and a just transition. More background on the role international public finance plays in shaping energy systems is available in this Oil Change International briefing.