Political inertia, financial short-termism and vested fossil fuel interests threaten to push up global temperatures, says Oxfam
Political inertia, financial short-termism and vested fossil fuel interests
have formed a “toxic triangle” that threatens to push up global temperatures,
putting 400 million people at risk of hunger and drought by 2060, Oxfam said on
Friday, a week before a European Union summit to finalise a new climate and
energy policy framework.
In its Food, Fossil Fuels and Filthy Finance report, Oxfam warned that EU
leaders must resist pressure from the fossil fuel industry, which spends at
least €44 million (£35m) a year on lobbying the European bloc. The report also
urged leaders to commit to cuts of at least 55% in carbon dioxide emissions,
energy savings of at least 40%, and an increase in the use of sustainable renewable
energy to at least 45% of the energy mix.
EU leaders meet in Brussels on October 23-24 to agree on targets for
emissions cuts by 2030, deployment of renewable energy and improving energy
efficiency. The meeting comes ahead of the UN climate change conference in
Paris next year. The leaders are expected to agree an emissions cut target of
40% over 1990 levels, but Oxfam said this would not be enough for Europe to
make a fair contribution to tackling climate change. The EU
emits about 10% of global carbon dioxide.
“The fossil fuel industry has conjured a toxic triangle that is trapping us
into a warming world. Governments and investors are helping the industry to
recklessly protect its own profits at the expense of us all. The world’s
poorest are already being hit hardest and millions more will be made hungry by
climate change,” the Oxfam chief executive, Mark Goldring, said.
Oxfam says the “toxic triangle” supported spending of more than $674bn
(£423bn) on fossil fuels in 2012. Investment in the industry was propped up by
tax breaks, government incentives and an estimated $1.9tn of subsidies a year.
More than $500,000 a day was being spent on lobbying of US and EU governments,
it says.
Progress has been made, the report says, citing the proposal of the US president, Barack Obama, to cut carbon
emissions in the power sector by 30% over 2005 levels by 2030, and
discussions in China on “an absolute carbon cap” after 2016.
“These commitments and proposals all demonstrate that the international
community is beginning to wake up to the reality of climate change and adopt
the necessary rhetoric. Yet carbon emission reduction offers on the table so
far are not significant enough to advance the necessary transition, and thereby
shift private and public finance accordingly,” the report says.
Stephen Tindale, an associate fellow at the Centre for European Reform, argued in a September report that “inefficient fossil fuel
subsidies” needed to be stopped in Europe, in line with a G20 commitment made
in 2009.
“Ending them will save or raise substantial sums for governments. Spending
on energy efficiency is economically efficient as well as socially beneficial.
And investment in new energy technologies will enable European companies to
compete in export markets. European governments should give much of the revenue
from the phasing out of direct and indirect subsidies for hydrocarbons to the Green Climate Fund,” he wrote.
The UN’s Green Climate Fund aims to help developing nations tackle the
consequences of climate change, such as increased flooding, and invest in
cleaner energy.
Oxfam says fossil fuel companies would spend about $6tn to develop the
industry over the next decade, despite fossil fuels being responsible for 80%
of carbon dioxide emissions and the main contributor to climate change, which
threatens health, property, food, businesses and economic growth. It says this
investment is flawed, because regulation limiting warming to 2C could leave
$300bn of fossil fuel assets stranded, bursting the “carbon bubble” and leaving
savers and long-term investors out of pocket.
Oxfam urges governments to phase out fossil fuel emissions and introduce
sustainable renewable energy for all by early in the second half of the
century. It also wants governments to shift investment to renewables, energy
efficiency and policies to make sure the poorest people are able to access
energy. It argues for more transparency around lobbying and urges governments
to “climate proof” the global financial system by reviewing risk, improving
transparency and providing capital for low-carbon investment.
Fossil fuel and energy-intensive companies in the private sector must
diversify their business models to embrace a low-carbon future, and investors
should put money into low-carbon development and challenge firms that pursue
high-carbon strategies, it says.
“If fossil fuel use globally continues unabated, severe climate change
impacts on the poorest people will be unavoidable. Despite apparent global
aspirations to keep global warming below 2C – and associated commitments from a
range of countries – so far this has not been sufficient to achieve the
necessary financial shift away from fossil fuels and into clean energy alternatives,”
the report says.
“This ‘toxic triangle’ of political inertia, financial short-termism and
vested fossil fuel interests must be broken if the world is to seize the
multiple opportunities – in rich and poor countries alike – for a low-carbon
transition.”
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