News Article | August 30, 2016
Three major insurers with more than $1.2 trillion in assets under management have urged G20 governments to commit to phasing out fossil fuel subsidies. In a joint statement published by the Overseas Development Institute (ODI), major insurance companies Aviva, Aegon NV, and MS Amlin have urged governments to commit to phasing out fossil fuel subsidies by 2020 at the upcoming G20 leaders’ summit set to take place in September in Hangzhou, China. “We — representing insurers with more than USD 1.2 trillion in assets under management, and other institutions and businesses — urge G20 governments to establish a deadline for the phase out of fossil fuel subsidies and public finance for fossil fuels at the 2016 G20 Summit,” the three insurance giants wrote in their joint letter (PDF). Specifically, the insurers want the G20 governments to set “a clear timeline for the full and equitable phase-out by all G20 members of all fossil fuel subsidies by 2020, starting with the elimination of all subsidies for fossil fuel exploration and coal production. In addition, they urge governments to set a similarly clear timeline for the phase-out of “domestic and international public finance for oil, gas, and coal production by 2020” and asks “all G20 members to be fully transparent from 2017 onwards about all fossil fuel subsidies in a consistent format that is publicly available on an annual basis.” A lot has been said over the past two years about the shape and size of global fossil fuel subsidies. The International Monetary Fund last year concluded that we are subsidizing fossil fuels to the tune of $5.3 trillion each year. Another report published later in the year showed that G20 nations alone are spending $452 billion on fossil fuel subsidies each year. Cutting fossil fuel subsidies was shown last October to be able to reduce national emissions by an average of 11%. While another report published earlier this year revealed that if fossil fuel subsidies had not been in place during 2010, carbon emissions for that year would have been 46% lower than they actually were. “Making a profit is essential in business,” explained Mark Wilson, CEO of insurance company Aviva. “But we will only be in business in the future if we act sustainably and create wider long term social value. That’s just good business — and not acting sustainably is very bad business indeed.” “Climate change in particular represents the mother of all risks — to business and to society as a whole. And that risk is magnified by the way in which fossil fuel subsidies distort the energy market. These subsidies are simply unsustainable. “We’re calling on governments to kick away these carbon crutches, reveal the true impact to society of fossil fuels and take into account the price we will pay in the future for relying on them. Energy subsidies should instead be used to create a sustainable future through the social, environmental and economic objectives set out in the UN Sustainable Development Goals.” “These subsidies fuel dangerous climate change,” added Shelagh Whitley, the lead Research Fellow working on subsidies at ODI. “If we are to have any chance of meeting the 2C target set at the Paris climate summit then governments need to start a programme of rapid decarbonisation. “It is extremely worrying therefore that the G20 energy ministers earlier this year acted as if Paris hadn’t happened by repeating the same empty promises they have been making since 2009. “The finance sector recognises the importance of moving away from fossil fuels, governments need to realise they may be the only ones left not moving.” Drive an electric car? Complete one of our short surveys for our next electric car report. Keep up to date with all the hottest cleantech news by subscribing to our (free) cleantech newsletter, or keep an eye on sector-specific news by getting our (also free) solar energy newsletter, electric vehicle newsletter, or wind energy newsletter.
"LONDON - The G20 group of major economies spend $452 billion per year supporting fossil fuel industries, despite their primary role in causing climate change, according to a study released on Thursday. The report, which comes ahead of a crunch UN meeting in Paris to try to forge a global deal to avoid disastrous levels of climate change in December, accused governments of undermining their own climate change policies. 'G20 governments are handing out approximately $452 billion a year to prop up the production of fossil fuels - despite pledges to phase out subsidies and prevent catastrophic climate change,' the study by British think tank the Overseas Development Institute and Oil Change International found." "EU To Seek Coal Funding Phase-Out At OECD Next Week - Sources" (Reuters) "G20 Spends Four Times More on Fossil Fuel Output Than on Renewables, Think Tank Says" (Reuters)
News Article | August 31, 2016
Major global insurance companies are urging G20 leaders to commit to a specific timeline for rapidly phasing out fossil fuel subsidies – something they’ve repeatedly failed to do over the years despite numerous promises to end support for the industry. In a joint statement issued ahead of the G20 conference in China this weekend, insurers with more than USD$1.2 trillion in assets under management warn that support for the production of coal, oil, and gas is at odds with the nations’ commitment to tackle climate change agreed in Paris last December. The statement, signed by Aviva, Aegon NV, and MS Amlin, calls for governments to set “a clear timeline for the full and equitable phase-out by all G20 members of all fossil fuel subsidies by 2020.” It adds that the phase-out should begin by eliminating all subsidies for fossil fuel exploration and coal production. “Climate change in particular represents the mother of all risks – to business and to society as a whole,” said Mark Wilson, chief executive of Aviva. “And that risk is magnified by the way in which fossil fuel subsidies distort the energy market. These subsidies are simply unsustainable.” G20 nations have been pledging to phase out fossil fuel subsidies every year since 2009. Yet, research by the Overseas Development Institute (ODI) and Oil Change International shows governments spending $444 billion in 2013 and 2014 supporting the fossil fuel industry. Shelagh Whitley, lead research fellow working on subsidies at ODI, said: “These subsidies fuel dangerous climate change. If we are to have any chance of meeting the 2C target set at the Paris climate summit then governments need to start a programme of rapid decarbonisation. “It is extremely worrying therefore that the G20 energy ministers earlier this year acted as if Paris hadn’t happened by repeating the same empty promises they have been making since 2009.” In May, G7 nations agreed to phase-out fossil fuel subsidies by 2025. However, when G20 leaders gathered the following month, they were met with criticism for failing to follow the G7 in setting a date to end the subsidies. And insurance companies aren’t the only ones putting pressure on the upcoming G20 meeting to set a clear phase-out timeline. Last week the Institute and Faculty of Actuaries (IFoA) joined the ODI in calling for leaders to end support for fossil fuels by 2020. Chair of the IFoA’s Resource and Environment Board, Nico Aspinall, said: “Without these subsidies, there would be a more level playing field for the investment in renewable energy sources we desperately need to avoid the worst consequences of climate change in the future.” Also last week, a group of 130 major institutions controlling $13tn in investments called on the G20 nations to ratify the Paris agreement this year along with committing to increasing investment in clean energy and disclose climate-related financial risks. As ODI’s Whitley put it: “The finance sector recognises the importance of moving away from fossil fuels, governments need to realise they may be the only ones left not moving.”
News Article | November 23, 2015
A new report from the New Climate Economy highlights lessons learned from 15 countries who have undertaken reforms of fossil fuel subsidy policy. The paper, Fossil Fuel Subsidy Reform: From Rhetoric to Reality, was partly responsible for the 2015 New Climate Economy report, and now goes further in an effort to articulate “practical steps that policymakers can take to phase out fossil fuel subsidies” — a vital discussion in the lead up to the UN climate conference set to be held in Paris at the end of this month. The report examines what has worked and what hasn’t in attempts to reform fossil fuel subsidy policy, and provides “in-depth case studies of 15 countries.” “Phasing out fossil fuel subsidies offers both economic and climate gains,” said Ngozi Okonjo-Iweala, former finance minister of Nigeria and a member of the Global Commission on the Economy and Climate. “Reform could allow for targeted spending on public services for those who need it most and boost economic efficiency. And on the climate front, it could deliver global greenhouse gas emissions reductions of as much as 13% by 2050. Undertaking subsidy reform – and getting it right – is critical for better growth and better climate.” Over the past year we have seen numerous reports published identifying the extent to which industrialized nations around the world are supporting the fossil fuel industry with government-backed subsidies. The latest of these reports was published earlier this month by the Overseas Development Institute (ODI) and Oil Change Institute (OCI), and found that G20 nations are spending $452 billion on fossil fuel subsidies per year. “G20 governments are paying fossil fuel producers to undermine their own policies on climate change,” said Shelagh Whitley, of the Overseas Development Institute. “Scrapping these subsidies would rebalance energy markets and allow a level playing field for clean and efficient alternatives.” The latest report by the New Climate Economy forecasts worldwide governments will spend $650 billion funding fossil fuel subsidies in 2015. “Fossil fuel subsidies create significant burdens on government budgets, taking up as much as 5% of GDP in as many as 40 countries, often more than is spent on health or education,” said Helen Mountford, Program Director of the New Climate Economy. “Removing these subsidies can spur a virtuous circle, freeing up scarce government funds to be spent on other critical priorities, including better targeted support for the poor.” Specifically, in an attempt to provide clear principles for reforming fossil fuel subsidy policy, the report identifies the following steps: “The G20 and APEC have committed to phasing out inefficient fossil fuel subsidies, but most haven’t yet delivered,” added Shelagh Whitely, lead author of the report and a Research Fellow at the Overseas Development Institute. “They should follow the positive examples of change and scale reforms to eliminate fossil fuel subsidies by no later than 2025. In a time when low oil prices are expected to continue and many governments are looking to create fiscal space, there’s no excuse to delay phasing out fossil fuel subsidies any longer.” The full report is available here (PDF) Get CleanTechnica’s 1st (completely free) electric car report → “Electric Cars: What Early Adopters & First Followers Want.” Come attend CleanTechnica’s 1st “Cleantech Revolution Tour” event → in Berlin, Germany, April 9–10. Keep up to date with all the hottest cleantech news by subscribing to our (free) cleantech newsletter, or keep an eye on sector-specific news by getting our (also free) solar energy newsletter, electric vehicle newsletter, or wind energy newsletter.
Renewable energy company TerraForm Global Inc. is pulling out of an agreement to take control of projects accounting for 2,200 megawatts of generation capacity due to adverse market conditions in Brazil, companies involved in the deal said on Tuesday. TerraForm, a unit of U.S.-based SunEdison Inc., was negotiating to take control of generation assets from Brazilian renewable energy company Renova Energia SA in a share swap valued at 13.4 billion reais ($3.45 billion). Gizmodo: Paris Is Covered in Fake Ads That Mock the Climate Talks' Corporate Sponsors U.K.-based activist group Brandalism has peppered the streets of Paris with 600 fake outdoor ads meant to expose the hypocrisy of COP21 Climate Conference corporate sponsors. The fake, unauthorized outdoor ads were strategically placed around Paris this past weekend, and were made to look nearly identical to the originals. The ads were prepared by an impressive array of artists, a team that includes Neta Harari, Jimmy Cauty, Banksy-collaborator Paul Insect, Escif, and Kennard Phillips. In all, some 82 artists contributed from 19 different countries. Guardian: U.K. Becomes Only G7 Country to Increase Fossil-Fuel Subsidies The U.K. is alone among G7 nations in dramatically increasing its fossil-fuel subsidies, despite an earlier pledge to phase them out, a new report has found. The revelation will embarrass ministers who want to take a leading role at a crunch U.N. climate change summit in Paris in December, but who have been sharply cutting support for green energy at home. The report from the Overseas Development Institute (ODI) and Oil Change International found that as a whole, G20 nations are responsible for $452B (£297B) a year in subsidies for fossil-fuel production. The G20, which meets on Sunday in Turkey, pledged in 2009 to phase out fossil-fuel subsidies. Pacific Standard: Where Should All the Coal Miners Go? Hillary Clinton's briefing on her plan calls for "federal investments that help people to find good jobs without having to move." Realistically, however, economic development is a slow process. It takes time for local governments to woo new industries, and for companies to make the decision to relocate and build new facilities. If coal country does manage to reinvent itself, as former industrial towns like Cleveland and Pittsburgh have successfully done, it's unlikely to happen quickly enough to provide jobs for most of today's coal miners. And if the economy of American coal country is utterly decimated by the shuttering of the coal industry, there won't be any local employers hiring, no matter what kind of retraining coal miners receive. It is usually best to save unpopular news until a major holiday. In Louisiana, a state with a history of brazen political corruption and dominance by the oil and gas industry, this is a time-honored method of limiting public outcry. Last Wednesday, the day before the Thanksgiving holiday, Entergy Louisiana informed state regulators that it would close its net metering program. The utility says that solar installations in its service area had reached a capacity exceeding 0.5% of its peak load, the level at which it is allowed to shut off the program.