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Spain joins commitment to end international oil, gas, and coal finance, bringing total for potential finance shifted to USD 23.6 billion per year 

This increases the number of signatories to 30 and the annual average of potential public finance shifted out of fossil fuels and into clean energy to at least USD 23.6 billion per year. This equals 37% of annual public finance for fossil fuels provided by G20 countries and the Multilateral Development Banks (MDBs) between 2018 and 2020. 

FOR IMMEDIATE RELEASE

November 10, 2021

Contact:
Laurie van der Burg, Oil Change International, laurie@priceofoil.org
Anna-Lena Rebaud, Amis de la Terre (France), anna-lena.rebaud@amisdelaterre.org

Spain joins commitment to end international oil, gas, and coal finance, bringing total for potential finance shifted to USD 23.6 billion per year 
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). Yesterday Germany and El Salvador joined the initiative and today Spain confirmed that it is joining too. This increases the number of signatories to 30 and the annual average of potential public finance shifted out of fossil fuels and into clean energy to at least USD 23.6 billion per year. This equals 37% of annual public finance for fossil fuels provided by G20 countries and the Multilateral Development Banks (MDBs) between 2018 and 2020. 

Today’s announcement means that the Spanish public finance institutions, including the export credit agency (CESCE), responsible for USD 1.9 billion a year in public finance for fossil fuels, will need to end this financing, including for gas projects, by the end of 2022. France is now the last of the five largest EU economies that has not yet signed the statement. If France does join, this would increase the potential amount of annual public finance directly shifted to USD 24 billion. 

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. France, Belgium and the European Bank for Reconstruction and Development (EBRD), some of the biggest EU fossil fuel financiers, are 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:

Anna-Lena Rebaud, Climate and Just Transition Campaigner at Friends of the Earth France said:
“Last week at the COP, Emmanuel Macron once more lectured other countries and presented France as a climate leader. Yet this government plans on supporting gas production until 2035, and is still considering supporting TotalEnergies’ huge gas project in the Russian Arctic, Arctic LNG 2! France is now the last country of the “Export Finance for Future” coalition, which it launched itself, that has not joined the UK-led statement. It is becoming unjustifiable. We urge the French government to follow the example set by 30 countries and institutions and commit to ending all public support to oil and gas by the end of 2022.”

Laurie van der Burg, Global Public Finance Campaign Co-Manager at Oil Change International said:
“It is great to hear that Spain today joined the commitment to end international public finance for oil, gas and coal. This means that Spain will have to stop financing gas projects too. The science is clear that without relying on large-scale deployment of unproven and expensive carbon removal technologies, expanding gas infrastructure is incompatible with limiting global heating to 1.5°C. Today’s announcement leaves France as the last of the five largest EU economies that has not yet signed the statement.”

 

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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), Germany, Mali, Marshall Islands, New Zealand, Moldova, Portugal, Slovenia, South Sudan, Spain, Switzerland, the European Investment Bank, The Gambia, The United Kingdom, The United States and Zambia.
  • The estimate of a direct $23.6 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.