G20 countries have spent around 700 billion USD to support fossil fuels in 2021

G20 countries have spent around 700 billion USD to support fossil fuels in 2021

On November 1, 2022, Bloomberg NEF and Bloomberg Philanthropies released the Climate Policy Factbook.

What are the main findings of the factbook?

  • G20 countries continued to provide significant financial support for fossil fuel production and consumption in 2021.
  • Fossil fuel subsidies reached their highest level since 2014 in 2021, threatening Paris Agreement commitments to limit greenhouse gas emissions.
  • In 2021, G20 members provided subsidies worth around USD 700 billion to the coal, oil, gas and fossil-fuel industries.
  • This increased investment in emissions-intensive equipment and infrastructure and encouraged inefficient fossil fuel consumption and production.
  • Coal’s share of G20 fossil fuel support is slowly declining. It has declined from 4.1 percent in 2016 to 2.9 percent in 2021. However, US$20 billion has been invested in coal in 2021. This comes despite efforts to phase out coal. The recent G20 conference and COP26 pledged to phase out this fuel.
  • China contributed the highest share (26 percent) of fossil fuel subsidies in 2020. However, on a per capita basis it is lower than other G20 members. The country lags behind Saudi Arabia, Argentina and Canada when considering per capita fossil fuel subsidies.
  • Canada will more than double its support for fossil fuels in 2020. United States fossil fuel subsidies increased by 57 percent in 2020 compared to 2016.
  • Although policymakers have recognized the threat climate change poses to financial stability, only the European Union and the United Kingdom have passed laws or regulations requiring national disclosure of climate-risk information to investors. Currently, most G20 countries are launching pilot programs and issuing voluntary guidelines.
  • Only 12 G20 countries currently implement national carbon pricing. A true carbon price is important to hold companies and consumers accountable for greenhouse gas emissions.
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