$1.4 trillion of public money went to the fossil fuel sector last year
Public financing of the fossil fuel industry by G20 countries reached record levels in 2022, a new report has found. The fossil fuel industry is among the sectors most directly responsible for driving the climate crisis.
According to a report by the International Institute of Sustainable Development (IISD), $1.4 trillion of public money flowed into the industry last year in G20 countries, which are among the world’s largest economies. The staggering sums are more than double that of the pre-covid period, despite commitments made at the Glasgow COP26 climate summit in which world leaders pledged to the phasing out ‘inefficient’ subsidies for fossil fuels.
The IISD research found that much of the support related to mitigating the cost of energy for consumers, but that one third was driving investment in new fossil fuel production, equivalent to around $440 billion.
The report’s authors wrote: “This support perpetuates the world’s reliance on fossil fuels, paving the way for yet more energy crises due to market volatility and geopolitical security risks. It also severely limits the possibilities of achieving climate objectives set by the Paris Agreement by incentivizing greenhouse gas (GHG) emissions while undermining the cost-competitiveness of clean energy.
“G20 governments need to shift their financial resources away from fossil fuels to instead provide targeted, sustainable support for social protection and the scaling-up of clean energy. Maintaining fossil fuel prices that reflect the cost these fuels impose on society will be necessary to reduce fossil fuel use.”
The publication of the report comes ahead of a G20 meeting in Delhi next month. That meeting is seen as a crucial precursor to the next round of international climate negotiations taking place in the United Arab Emirates in November.
The report found that $1 trillion was provided in subsidies to fossil fuels, $322 billion took the form of investments by state-owned enterprises and $50 billion in loans from public finance institutions.
Chris Jarvis is head of strategy and development at Left Foot Forward
To reach hundreds of thousands of new readers we need to grow our donor base substantially.
That's why in 2024, we are seeking to generate 150 additional regular donors to support Left Foot Forward's work.
We still need another 117 people to donate to hit the target. You can help. Donate today.