Canada ends new hydrocarbon financing

The agreement, signed at COP26 in Glasgow, Scotland, also plans to place greater emphasis on financing renewable energy. (Photo: 123RF)

Glasgow – Canada joined the United States, the United Kingdom and 21 other countries on Thursday in signing an agreement to end new direct government funding for coal, oil and gas development by the end of 2022.

A joint statement released Thursday morning at the United Nations Climate Conference (COP26) in Glasgow, Scotland, predicted that the signatories would not give any new direct support to its traditional fossil fuel sector. The end of 2022 internationally. They also promise a greater emphasis on financing renewable energy.

“If we continue to channel our investments, innovations and brainpower into ambitious climate action, Canada could be a leader in a low-carbon world,” Environment Minister Steven Gilbault said in a statement. This means that new international public investment in the sustainable production of energy from fossil fuels must be halted quickly and the shift towards clean energy sources must begin. “

The Government of Canada indicates that it has not yet defined the scope of this new policy. The agreement makes it possible to continue funding fossil fuels “under rare clearly defined conditions that are consistent with the 1.5 °C warming limit and the objectives of the Paris Agreement”, a statement from Canada’s Ministry of Natural Resources specifies.

(re)read: fossil fuels: Canada leads the G20 for funding

An environmental group investigating public funding for the fossil fuel sector estimates that the deal could allow governments around the world to move up to $22 billion to clean energy. Oil Change International explores loans, credit guarantees, grants, equity purchases and insurance coverage provided by government agencies to fossil fuel producers. In a recent report, the organization concluded that this support totaled $78 billion in 2018.

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The report also found that among the G20 countries, Canada was the largest financial contributor to fossil fuels. Ottawa will provide about $14 billion per year, primarily through Export Development Canada, a government agency that helps Canadian businesses sell their products overseas, but also helps producers of oil and gas in their development at home. helps too.

Bronwen Tucker, a researcher who helped write the Oil Change International report, believes Thursday’s deal means Canada will lose that title. According to him, the Glasgow Agreement could affect between $2 billion and $9 billion from Export Development Canada.

“The federal government must also hear loud and clear that it must deliver on its election promises and extend this commitment to Export Development Canada’s closely related domestic funding (and) other domestic subsidies for fossil fuels.” should end.”

The joint statement, released Thursday morning at COP26, is the first international political commitment to address public financing of oil and gas. The 24 signatory countries say they will encourage other governments, as well as their export credit agencies and public financial institutions, to implement similar commitments.

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