Rich countries breach climate promises, increase fossil fuel spending
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The G20 increased spending on fossil fuels subsidies to record amounts in 2022, foregoing their COP26 commitments.
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Britain's King, then-Prince, Charles III at the G20 Summit in Rome, Italy in October, 2021. (AFP)
The world's richest countries breached their self-proclaimed climate commitment to limit fossil fuel investments and spent a record $1.4 trillion in subsidies on coal, oil and gas in 2022.
Double the cash flow poured into the non-renewable resources in 2019, an international organization that monitors anti-environmental practices of governments said in its latest report.
According to the International Institute for Sustainable Development (IISD), the G20 broke a unified agreement reached at a climate summit in Glasgow in 2021 to phase out “inefficient” fossil fuel subsidies.
Prioritizing fossil fuel subsidies in the upcoming G20 summit is crucial, said Tara Laan, a senior associate with IISD's Energy Program.
The leaders' meeting is set to take place in India's Delhi in September, and will be followed by a climate conference in the UAE in November.
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"These figures are a stark reminder of the massive amounts of public money G20 governments continue to pour into fossil fuels – despite the increasingly devastating impacts of climate change,” she said.
$1 trillion in subsidies, $322 billion in fossil fuel investments
By lowering prices through public subsidies, countries are encouraging citizens and industries to stick to consuming nonrenewable energy sources. In 2022, G20 countries spent $1 trillion on subsidies, $322 billion in investments by state-owned firms and $50 billion in loans from governmental finance institutions.
Despite committing to steer away from fossil fuel subsidies “over the medium term” in 2009, G20 leaders said they would accelerate the process during the COP26 climate summit in 2019.
However, this was not the case.
Among the factors contributing to falling short of achieving this plan was the COVID-19 pandemic and the record sanctions on Russia following the war in Ukraine, the latter of which caused a sharp rise in energy prices and forced Western governments to support energy spending to protect citizens from the skyrocketing living prices.
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The International Energy Agency concluded in a February published report that the rate of subsidies funding fossil fuel subsidies was a “worrying sign for energy transitions," but acknowledged that some measures were understandble “given the hardship that full exposure to market-driven prices could have caused”.
The IISD report suggested that with an increase in carbon taxes of $25-50 per capita, G20 could raise an extra $1 trillion annually. It also recommended that rich governments provide a sum of the collected cash to assist impoverished people most vulnerable to the rising costs caused by the transition.
“With fossil fuel companies gaining record profits amid the energy crisis last year, there is little incentive for them to change their business models in line with what’s needed to limit global warming,” said Laan. “But governments have the power to push them in the right direction.”
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Climate hypocrisy
Rich nations have been resisting increasing their financial engagement to support West-imposed roadmaps on how to battle climate change, claiming that it would take time to determine whether such a fund was necessary and how it would function.
Although a $100 billion a year was pledged in 2009 in the UN by rich countries for developing countries under a roadmap to fight climate change, it was never upheld by the parties that announced their commitment.
Another failed scheme is a 2021 pledge made by G20 members to rechannel $100 billion in IMF special drawing rights (SDR) from rich states to impoverished economies.
The Center for Global Development (CGD) revealed last year that CO2 emissions produced by people in the West are astronomically larger than those produced by individuals in the Global South.
According to a CGD study, in just the first two days of January 2022, the average UK citizen was already responsible for more carbon dioxide emissions than someone from the Democratic Republic of the Congo would produce in an entire year.
The director for energy and development at the California-based Breakthrough Institute, Vijaya Ramachandran, revealed in a study published in November 2021 that the West is practicing a form of "colonialism" against poor nations when pressuring a total ban on fossil fuel projects, which will only lead to more poverty without leaving no actual impact on the world's carbon dioxide emissions.
“It’s very easy for rich countries to impose fossil fuel financing bans on poor countries, while at the same time increasing their own consumption of fossil fuels,” Ramachandran said. “It’s rank hypocrisy and it’s devastating for poor countries as they need a wide range of energy to fuel development."
“It’s well known renewable energy is intermittent and needs to be backed up by other sources. Telling African countries they just need solar is completely hypocritical and colonial.”
