G7 criticized for Covid bailouts with no ‘green conditions’ attached
The world’s major economies have allocated more than $ 189 billion in pandemic stimulus funds to support fossil fuels, despite government commitments to “build back greener” and reduce carbon emissions.
More than half of the $ 372 billion given by G7 countries for energy production and consumption activities from January 2020 to March this year was for coal, oil and gas, according to a Tearfund study, a development charity, supported by two independent think tanks.
Most of the money was handed over “unconditionally” with no demands on the companies receiving assistance to reduce their carbon footprint.
“The post-Covid economic recovery is a huge opportunity to accelerate the transition to a green economy,” said Rich Gower, senior partner at Tearfund. “At the moment, the G7 is not seizing this opportunity.”
The pandemic lifelines highlighted in the report included the German government’s € 9 billion bailout of Lufthansa airline and $ 10 billion in US government support to airports.
About $ 147 billion has been spent on clean energy projects, like a tax incentive in Italy to encourage people to make their homes more energy efficient.
The G7 countries account for around a quarter of global carbon emissions, although they only represent around 10% of the world’s population.
Governments have raised their green commitments this year ahead of the United Nations climate change conference, known as COP26, which takes place in Glasgow in November. More ambitious emission reduction plans have come with promises to inject money into the development of new green jobs and industries.
In May, the G7 countries pledged to stop all new funding for overseas coal projects by the end of this year and to make “accelerated efforts” to limit global warming to 1.5 ° C compared to pre-industrial times.
However, Tearfund’s research has found that much of the recovery spending so far has been at odds with plans to embrace cleaner energy sources.
In a separate report released on Wednesday, the International Energy Agency said there had been an increase in approvals for coal-fired power plants in 2020, driven by projects in China and some other Asian countries.
Investments in the upstream oil and gas industry are expected to increase by around 8% this year, but remain below pre-crisis levels, the IEA added.
“Governments must move beyond emission reduction promises and take concrete steps to accelerate investments in clean energy solutions ready to market and promote innovation in early stage technologies,” said Fatih Birol, Executive Director of the AIE.
According to the Tearfund report, the governments of Australia, India, Korea and South Africa – the guests of the G7 summit – have all supported the expansion of coal production either financially or through measures. policies since January 2020.
The researchers recommended that the G7 adopt a “do no harm” principle for all spending, which should include attaching “green chains” to any support to fossil fuel-intensive sectors, and ending money. utilities for the production of coal, oil and gas.
The G7 should also use its influence to urge development banks to align their activities with limiting global warming to 1.5 ° C, according to the report.
“Every penny counts,” Gower said. Spending on dirty energy today “perpetuates fossil fuels into the future”.
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