A draft proposal to end investments in fossil fuels is circulating among the heads of the European Investment Bank. The proposal will be discussed at the next board meeting of the bank in September. If approved, the bank would stop funding fossil fuel activities at the end of 2020, according to a report by Oil Change International.
This could be a significant blow to the fossil fuel industry. OCI, which tracks the financial aspects of the oil industry, says since 2013 the majority of investments made by the bank have gone to finance fossil fuel activities, primarily infrastructure-related projects involving transporting and refining oil. It says the bank pumps nearly $3 billion a year into the industry.
In an email to CleanTechnica, Alex Doukas, lead analyst for Oil Change International, had the following comment about the draft proposal: “The European Investment Bank’s proposal to end financing for fossil fuels by the end of 2020 is a massive step forward on climate leadership. With this move, the world’s largest multilateral lender is now poised to leave oil, gas, and coal in the past.
“The European Union member states who control the bank must now stand behind the EIB’s game-changing climate leadership by swiftly approving this new policy, and other financial institutions should quickly follow suit and stop funding fossils.
“As Europe swelters under a record-breaking heatwave, with all-time high temperatures across Germany, France, the Netherlands, and Belgium, the need for bold climate action has never been clearer.
“Tens of thousands of people have signed petitions, written emails to their governments, and taken to the streets to demand a fossil free EIB. This strong draft from the EIB is a reflection of that people power and shows that our institutions can respond to the climate challenge when we bring our collective power to bear.
“We will not stop until our governments do what is required to fight the climate crisis — and that means ending all forms of government support for fossil fuels, and a managed and just transition away from oil, gas, and coal.”
Many fossil fuel apologists claim that nations can transition from oil and coal to natural gas and still meet their carbon reduction goals as set forth in the Paris climate change agreements. Not so, argues OCI.
“Building new, long-lived fossil gas infrastructure that will expand or lock in extraction is inconsistent with the climate goals in the Paris Agreement. Just the oil, gas, and coal reserves in already-operating fields and mines would exceed the Paris Agreement’s limits. Put another way, even optimistic scenarios for a 1.5° C-compatible pathway show there is no room for gas to grow if we are to have a safe climate future.”
According to its research, Oil Change International finds:
- Fossil gas cannot act as a “bridge” fuel because further development of gas reserves is incompatible with carbon budget limits and more effective and affordable renewable alternatives already exist.
- The various kinds of non-fossil gas are limited in their potential to be fully decarbonised, technologically feasible, and cost-effective. This means they are suited to play a limited, medium-term role in decarbonising hard-to-electrify sectors like heavy industry, as opposed to being deployed for mass distribution.
- Carbon capture and storage technologies that the arguments for fossil and non-fossil gas expansion rely on remain unproven at scale and prohibitively costly.
- None of the European Commission’s climate action scenarios anticipate an expanded role for gaseous energy carriers.
- The vast majority of investment associated with the EU Projects of Common Interest (PCI) list is for projects directly tied to upstream fossil gas sources, making PCIs exceedingly unlikely to be usable as non-fossil gas carriers in future.
In other words, time to get real, people. We have used up our carbon budget. The window of opportunity for maintaining a sustainable environment for human beings here on Earth is closing rapidly. Shut off the flow of money to the fossil fuel industry while there is still time.
There is no time for looking back with longing eyes to the giddy days of 1950 when cheap oil was considered a boon. Now that we know it is actually a death sentence for the Earth and the human race, we need to stop pretending we still live in a Leave It To Beaver world and begin behaving like responsible adults.
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