EU financial institutions and funds channel billions of euros into fossil fuel projects, while EU policies and laws allow for yet more public money to flow into fossil fuels through the back door.
[Brussels 1 September 2016] This is the conclusion of a briefing on the various forms of fossil fuel subsidies in the EU, published by Climate Action Network (CAN) Europe today, ahead of the upcoming G20 summit where the topic will be discussed.
The briefing “Connecting the dots – EU’s funding for fossil fuels” provides a snapshot of the numerous ways the EU channels public money into fossil fuel investments.
It shows that the European Investment Bank and the European Bank for Reconstruction and Development, have channelled more than €12 billion to fossil fuel projects between 2013 and 2015 while two of the EU’s most influential funds, the Connecting Europe Facility and European Structural and Investment (ESI) funds, have earmarked over €1.6 billion for fossil fuel infrastructure from 2014 to 2020. In addition, EU policies such as the Emission Trading Scheme (ETS) and rules such as those on State aid continue to allow EU countries to support controversial fossil fuel projects with tax payer’s money.
The briefing comes ahead of the G20 leaders’ summit in Hangzhou, China on 4-5 September, where G20 leaders will discuss fossil fuel subsidies, climate finance and swift ratification of the Paris Agreement. As European Commission and Council Presidents Juncker and Tusk prepare for the upcoming summit, the briefing is published together with a letter calling on the EU to incite concrete action to tackle fossil fuel subsidies and align the EU’s public funding with the Paris Agreement.
Maeve McLynn, Finance and Subsidies Policy Coordinator at CAN Europe said: “The EU proudly stipulates that it has been a leading voice in advocating for strong climate action internationally. It has also pledged to phase out environmentally harmful subsidies, including fossil fuel subsidies by 2020. However, the briefing published today shows that the EU is way off track to achieve this goal, and that its public funding is out of sync with the Paris Agreement”.
She continued: “The Hangzhou summit is an opportunity for all G20 leaders to pave the way for a smooth and prosperous transition to zero carbon economies. We expect the EU to take a lead position for stronger G20 climate leadership through achieving a 2020 deadline to phase out fossil fuel subsidies. It is also high time that the EU puts its money where its mouth is, by urgently reforming its policies and tools that both directly and indirectly support the fossil fuel industry”.