March 18, 2021 In a newly released letter, nearly 450 organizations called on the Biden Administration to immediately end all U.S. public financing for fossil fuels, including natural gas. Signatories to the letter span six continents and include major U.S. civil society organizations, international groups, and organizations in the Global South concerned about the impacts of U.S. support for overseas fossil fuel projects. […]
March 18, 2021
In a newly released letter, nearly 450 organizations called on the Biden Administration to immediately end all U.S. public financing for fossil fuels, including natural gas.
Signatories to the letter span six continents and include major U.S. civil society organizations, international groups, and organizations in the Global South concerned about the impacts of U.S. support for overseas fossil fuel projects.
“Fossil fuel pollution kills over 8 million people prematurely yearly, according to a Harvard study. That’s 350,000 people per year in the U.S. We must stop financing the fossil fuel industry. Too many people have died already,” said Dominic Frongillo, Elected Officials to Protect America Executive Director and Co-Founder. “President Biden knows subsidies of this dangerous, toxic industry need to end for America to lead the world in addressing the climate emergency. We urge the President to shift those funds to power a clean, renewable energy future.”
Elected Officials to Protect America is a coalition of elected officials from every state dedicated to protecting the environment and combating climate change. EOPA successfully helped to ban fracking in New York and get the state’s pension fund comptroller to divest fossil fuels from the fund.
U.S. public finance for overseas fossil fuel projects averaged more than $4 billion (USD) annually over the past decade, according to Oil Change International data, at times exceeding $10 billion USD in a single year. This finance was distributed primarily through the U.S. Export-Import Bank and the U.S. Development Finance Corporation, formerly the U.S. Overseas Private Investment Corporation.
The letter follows a Biden Administration executive order which directed agencies to end “carbon-intensive” finance, a commitment that Climate Envoy John Kerry characterized as “a plan for ending international financing of fossil fuel projects with public money.” The signatories call for a policy that excludes U.S. public finance for all fossil fuels, including gas, which received high volumes of support under both the Obama and Trump administrations.
Dozens of groups from many countries where the U.S. has financed fossil fuel projects — including Brazil, Colombia, El Salvador, Georgia, Ghana, India, Nigeria, Papua New Guinea, South Africa, Turkey, Uruguay, and elsewhere — have signed onto the letter urging the Biden Administration to make good on it’s commitment to end high-carbon finance.
The letter argues that if the U.S. announces an immediate end to its international support for fossil fuels, this would influence many other governments to do the same, and could help eliminate tens of billions of dollars annually in support for the fossil fuel industry. Analysis shows that G20 governments alone have provided at least $77 billion USD annually in public finance for fossil fuels, even after the Paris Agreement was reached.
A commitment to end fossil fuel finance would enable the U.S. to join forces with other governments that have taken steps in this direction. The United Kingdom — the host of this year’s G7 Summit and United Nations climate negotiations — is the first major economy to announce such a policy across the whole of government. Prime Minister Boris Johnson announced an end to public finance for fossil fuel projects overseas in December 2019, and following a public consultation on the topic, the government is expected to publish its new policy over the next few weeks. A joint commitment around the time of the G7 Summit in June, for example, would put further pressure on peers providing large volumes of finance for highly-polluting activities such as Japan, Canada, and China, and would build momentum for climate action toward the United Nations climate negotiations in November.
“By promoting fossil fuel projects overseas, especially gas infrastructure, the U.S. is making it harder for countries to decarbonize. We have to stop subsidizing fossil fuel companies at the expense of our climate. It’s irrational for an administration so focused on climate change to promote LNG facilities. Those facilities could waste billions in taxpayer dollars and would lock countries into high-emissions pathways. Why would we promote fossil fuel infrastructure in Vietnam, for example, instead of competing with European and Chinese businesses that are dominating the renewables market there?” said Han Chen, manager of energy for the International program at The Natural Resources Defense Council.
If the commitment comes soon, it could also significantly influence the Asian Development Bank’s review of their energy lending policy, as the U.S. is the Bank’s largest shareholder alongside Japan.