Rich countries sweep billions in public finance for coal under the rug as climate deadlines loom

Rich countries sweep billions in public finance for coal under the rug as climate deadlines loom
Alternatives to dirty coal exist - and are growing everywhere. Credit: WWF / Adam Oswell

Over the last eight years, developed country governments have channelled more than US$73 billion of public money into coal projects, says research released today.

The , averaging US$9 billion a year, is responsible for as much pollution as some developed countries as detailed in "Under the Rug: How Governments and International Institutions Are Hiding Billions in Support to the Coal Industry." The new report by WWF, Natural Resources Defense Council and Oil Change International comes as global driven by carbon-intensive energy use accelerate.

As the 34 countries of the Organisation for Economic Co-operation and Development (OECD) gather for their annual Ministerial meeting and G7 leaders prepare to meet in Germany next week, rich nations must seize these key political opportunities to ensure their climate credibility by taking ambitious and urgent action so the planet can avoid the worst impacts of climate change.

"Many developed country governments that push for ambitious climate action are simultaneously funding coal abroad. They cannot do both and be credible," said Samantha Smith, leader of WWF's Global Climate and Energy Initiative. "It is time for rich nations to put their money behind the solutions, like renewable energy, rather than using taxpayers' money to fuel ."

The report reveals that international public finance for coal between 2007 and 2014 is responsible for as much pollution as Italy, the country with the 20th highest emission globally. During this period, total greenhouse gas emissions amounted to almost half a billion tons of carbon dioxide equivalent per year.

Over the eight years tracked by the report, Japan provided the largest amount of coal financing of any country, at over US$20 billion. From OECD members, whose official Export Credit Agencies provide nearly half of the total international finance for coal, Korea and Germany were the next largest sources of funding for coal.

Non-OECD nations China and Russia account for 23 per cent of public finance for coal with multilateral development banks making up 22 per cent.

Contradicting the claim that export finance for coal is necessary to fight energy poverty in poor countries, the report shows that zero export finance for coal has gone to low income countries, where the need for energy access is greatest. Instead, 25 per cent of this finance went to high income countries with no energy poverty concerns.

With UN climate negotiations for a new global agreement taking place later this year, Nordic countries, the UK, USA and France as well as financial institutions such as the World Bank have recently pledged to stop coal power plant finance. This is reflected in the report by a reduction in public finance for in 2014.

"All developed countries must follow the examples set in 2014. If they want to be credible in Paris when asking developing countries to commit to an ambitious climate agreement, rich countries must ensure consistency between commitments and export finance policies. It's time to fund the solutions of the future, not the dirty fuels of the past," said Smith.


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Jun 02, 2015
The owners and purveyors of Filthy Fuels are cheaters.

Jun 03, 2015
I'm shocked ... but at the same time I'm not surprised. In the coal states, Ky, WV... the coal moguls have a lot of clout on the local and state legislatures and on the senators and congressmen of the districts. They claim to put people to work, but with mountain top removal what used to employ 100s now takes 4 or 5 low payed truck drivers. These companies will come in, strip mountain ranges, and abandoned them un-replenished, declare bankruptcy and leave town, when they are sued. They are criminals and deserved to be in jail for their willful destruction of the environment. All of them!


Jun 03, 2015
The only costs that matter to most politicians and decision-makers are the immediately measurable dollars and cents paid today for energy used today. Any immediate secondary or nonmonetary costs (environmental damage, public health deterioration, etc.) are ignored, and deferred costs (mitigation of environmental damages, adaptation to climate change and sea level rise, etc.) are dealt with reactively rather than proactively, at multiple times the expense. A relatively small investment by the fossil fuel industry has provided plenty of fodder for deniers and other proud members of the illiterati to shout their kick-the-can philosophy to the rooftops, and immediate cash rewards are used to justify it. Our children and grandchildren will ultimately have to pay the piper.

Jun 06, 2015
Meanwhile, Australia, Japan, China, India, Russia and the U.S. , among others, burn coal as their primary power source. Germany is turning it's back on pie-in-the-sky "alternate" energy sources and firing up mothballed coal stations. Germany is also the third largest exporter of lignite -- soft coal.

Jun 07, 2015
The owners and purveyors of Filthy Fuels are cheaters.


That means you and me. We are cheating ourselves.

Governments are pretending to support renewable energy because it wins them votes and is generally regarded as what they should do, and they're funding fossil energy because it keeps the energy prices down and keeps the economy going so people wouldn't starve on the streets.

We're pretending to do what we want, and actually doing what we must. You'd be an idiot to think that we could suddenly just switch to renewable energy that costs three times as much without any ill effects, in particular to the masses of the poor and lower classes.

If you ask a person working minimum wage how they'd feel about paying three times as much for their food and fuel in exchange for preventing climate change a hundred years from now, they'd say "burn the coal".


Jun 07, 2015
deferred costs (mitigation of environmental damages, adaptation to climate change and sea level rise, etc.) are dealt with reactively rather than proactively, at multiple times the expense.


Well, who do you throw under the bus to pay for the cost NOW rather than later?

What if you end up spending the money on ineffective remedies?

The cost of taking the blind approach immediately may be lower in the end, but the risk is higher, so the value of action vs. inaction is not that different. Taking the change everything now attitude is ignoring the fact that you don't necessarily know what you're doing.

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