Associated Press
Wed, December 20, 2023
Dutch bank ING announced Wednesday Dec. 20, 2023 that it is accelerating its phasing out of funding for oil and gas exploration and production activities while it increases financing for renewable energy.
(AP Photo/Peter Dejong, File)
THE HAGUE, Netherlands (AP) — Dutch bank ING announced Wednesday that it is accelerating its phasing out of funding for oil and gas exploration and production activities while it increases financing for renewable energy.
ING has faced fierce criticism from Dutch climate activists for its funding of fossil fuel companies.
The ING announcement came a week after nearly 200 countries at the COP28 climate meeting in Dubai agreed to move away from planet-warming fossil fuels in a document that critics said contained significant loopholes.
ING said its loans to oil and gas exploration and production activities will be cut by 35% by 2030 and 10 years later “the financed emissions linked to our portfolio will be reduced to zero.” Meanwhile, the bank said, it will raise financing of renewable power generation to 7.5 billion euros ($8.2 billion) annually by 2025 from 2.5 billion euros ($2.7 billion) in 2022.
“The world needs energy, but still too much of that is coming from fossil fuels," ING CEO Steven van Rijswijk said in a statement.
Greenpeace in the Netherlands called the announcement a “step in the right direction,” but warned that “our planet is on fire, let's be honest: only stepping away from the fire is not enough as long as you keep fanning the flames.”
2024 will put COP28’s goals to the test
Tim McDonnell
Wed, December 20, 2023 at
The Facts
The headline-grabbing promise of the COP28 agreement — that countries will endeavor to “transition away from fossil fuels” — doesn’t come with a specific deadline. But another part of the agreement does. The deal says annual global greenhouse emissions need to peak by 2025 to stay within the global warming limit of 1.5 C. That means for the biggest emitters, 2024 will be a critical turning point for the energy transition, in which it will either speed up or miss the window of opportunity to keep 1.5 C within reach.
Tim’s view
This year was a challenging one for the energy transition, pitting the human and economic costs of climate change against the big picture conditions of the global economy — war and nationalism, high inflation and interest rates — that tend to favor the fossil-fuel status quo. Those headwinds are unlikely to let up in 2024. These are the big questions that will shape whether COP28’s aspirations will remain within reach.
Will global climate trade wars continue to heat up? Next year will be the first that European importers of industrial products like aluminum and fertilizer will need to report the carbon footprint of those goods. That reporting requirement will put pressure on suppliers around the world to start to decarbonize or risk losing market access when the EU’s carbon border tariff goes into full effect in 2026. The U.K. has outlined plans for its own version, and expect to see more political momentum to erect similar barriers in the United States. Meanwhile, Western companies and governments will continue to try to undermine China’s vise grip on the supply chains for critical minerals and clean energy hardware, which could drive prices up in the near term, especially if Beijing weighs additional export restrictions of its own.
Can clean-energy investors recover their nerves? Even though the costs of solar power hardware have fallen to record lows, and there have never been more government incentives for clean energy, investment in the sector is at risk of stalling out. Rising borrowing costs make the economics of renewable energy projects less attractive, and U.S. regulators are weighing new banking rules that could restrict lending even more. Share prices of clean energy companies have suffered this year, and in 2024 global clean energy investment could fall 9%, according to a forecast this week by the Swedish bank SEB. But the story isn’t all bad. Climate tech is drawing a growing share of venture capital investment, and there is enormous appetite from high-emitting companies to acquire decarbonization solutions. Climate removal tech had a banner year in 2023, and will probably have another in 2024. Investment in clean energy manufacturing facilities in the U.S. has been growing steadily and will likely continue next year as well.
Will EVs reach a sales tipping point or sit on dealer lots? Starting Jan. 1, most electric vehicles for sale in the U.S. will lose eligibility for the full $7,500 tax credit they qualified for this year, as rules to exclude China-produced components become more strict. Sales are expected to continue rising anyway, but at a slower pace, according to BloombergNEF: A 32% gain in 2024, compared with 47% in 2023. That leaves major automakers in a bind, as they struggle to set the right pace for their EV investments. EVs are piling up on dealership lots. But automakers are still engaged in a protracted price-cutting war to defend their market share against discount EV options from China. Those price cuts, plus a loophole that allows leased EVs to remain eligible for tax credits, along with the plummeting costs of batteries, will all be wins for consumers in 2024. And they’re a powerful driver of the transition away from fossil fuels, as the electrification of transportation takes a major bite out of oil demand.
How will oil and gas companies balance current demand with long-term investment risk? biggest long-term gas contract
Can the transition survive the U.S. presidential election? If Donald Trump wins another stint in the White House, it will set up a test of how resilient the long-term energy transition is to short-term politics. Clean energy is much cheaper than it was during Trump’s first term, and the Inflation Reduction Act has driven a surge in onshoring and re-industrialization that make the economic benefits of the transition much more tangible to more voters. So to some extent, there may be a limit to how much damage Trump can do. But there are plenty of areas where his administration could impede climate progress: Trump may be unwilling or uninterested in finding a bipartisan solution to permitting reform; he could toss or simply not enforce Biden-era emissions regulations from the Environmental Protection Agency; and could withdraw the U.S. from the Paris Agreement and from climate-focused trade deals with the EU.
The View From India
For countries in the global south, a key determinant of when they’ll hit peak emissions is foreign investment and financial aid. The COP28 agreement was roundly criticized by developing country governments for being vague and noncommittal about climate finance, essentially letting the U.S. and other rich big emitters off the hook for underwriting developing countries’ adoption of clean energy. The UAE and other Gulf oil exporters, meanwhile, seem more than happy to fill that development finance void with investments in fossil fuel infrastructure, for example with a $50 billion investment to build the world’s largest oil refinery in India. If the U.S. can’t step up its climate finance game, in other words, it risks not just undermining decarbonization in the countries with some of the fastest growing populations and energy demand, but also giving up significant geopolitical leverage.
The Secret Weapon of Climate Negotiations: Language
Genevieve Guenther
Tue, December 19, 2023
In the week since the twenty-eighth Conference of the Parties, or COP28, climate talks wrapped up, media coverage of the outcome has been largely positive. That coverage has focused on the statement produced at the end of the conference, which “calls on” participating nations to “contribute” to the “transitioning away from fossil fuels in energy systems.” This marks the first time since the inaugural COP of 1995 that a final text actually mentions the words “fossil fuels.” Not even the 2015 Paris Agreement acknowledged that coal, oil, and methane gas are the root causes of climate change.
Insofar as commentators have criticized the consensus text negotiators reached in Dubai last week, they’ve noted that it lacks both ambition and teeth, since it calls merely for a “transition away” from fossil energy, when it should call for “drastic immediate emission cuts and binding commitments from the largest contributors of the climate crisis to finance loss and damages” and adaptation, as Greta Thunberg put it.
But the problem with the outcome of COP28 is not only that it’s weak. It’s that the statement is a masterclass in propaganda, upholding two prevalent and pernicious forms of greenwashing that support expanded coal, oil, and gas production: the false claim that the world can continue to use fossil fuels and still halt global heating and the equally false, if more subtle, claim that fossil-energy companies are trustworthy partners in the fight to preserve a livable climate. The positive coverage of COP28 shows that this greenwashing has succeeded in obscuring what really happened in Dubai.
How does a text that calls on nations to contribute to the “transitioning away from fossil fuels” uphold the idea that the world can continue to use them? That seems like a paradox. Yet this is the paradox inherent to greenwashing itself. Actions to uphold the fossil fuel status quo are trusted because they look like efforts to make change.
This dynamic is front and center in the COP28 decision text. First, let’s look at what the text demands: It “calls on” parties (i.e., nations who are “party” to the U.N. Framework Convention on Climate Change) to “contribute to ... transitioning away from fossil fuels in energy systems.” This may sound robust, but under UNFCCC guidelines, the verb “calls on” is the weakest possible request to the parties. It is truly a take-it-or-leave-it suggestion. And the text never defines what counts as a “contribution” to transitioning away from fossil fuels. Could a government merely establish a task force to study low-carbon energy systems and count that as a contribution? Going by this text, yes!
This same vagueness bedevils the text’s language on coal power, which “calls on” parties to contribute to “accelerating efforts towards the phase down of unabated coal power.” There are many levels of delay here: First, nations must respond to the call, then they must contribute to “accelerating efforts,” and then those efforts will move “towards” (but not achieve) the “phase down” rather than the “phaseout” of unabated coal power. (“Phaseout” implies eventually ceasing entirely; “phase down” does not.) It is worth noting also that “unabated” is yet another undefined term, implying that coal that is abated, i.e., that is offset somehow, is OK. This allows countries to claim without verification that they have offset their climate pollution.
So, yes, COP28 negotiators agreed on “transitioning away from fossil fuels,” but the vagueness of that goal, and its position at the end of a series of delaying steps, enables the governments involved to continue to promote expanded coal, oil, and gas production while still claiming to be following the letter of the text.
Even worse, the text actually provides support for fossil fuels when it “recognizes that transitional fuels can play a role in facilitating the energy transition while ensuring energy security.” Of course, providing parties with maximum interpretive flexibility, the text does not define “transitional fuels,” but historically methane gas has been represented as a “transition fuel” because it puts less carbon dioxide into the atmosphere than coal does.
Methane gas is itself a fossil fuel and a significant contributor to climate change; in the short term it forces more global heating than carbon dioxide does. Recent scientific studies have shown that when leaks from methane gas extraction, refining, and combustion are accounted for, methane gas is actually worse for the climate than coal. So any text that calls methane gas an element of the transition away from fossil fuels is in effect justifying many billions of tons more greenhouse gas pollution, virtually guaranteeing that the world will not achieve net-zero emissions in time to halt warming well below two degrees Celsius (3.6 degrees Fahrenheit).
Of course the United Arab Emirates, the host country of the conference, and Sultan Al Jaber, its president, celebrated the outcome as a great victory, calling it the “UAE Consensus” that will guide international climate action moving forward. Al Jaber called the text drafted at COP28 a “historic achievement” and a “paradigm shift.” This self-promotion is not just political theater but also the second form of greenwashing that currently retards progress in phasing out fossil fuels: the pretense of oil and gas executives and companies that they’re trustworthy partners in the energy transition.
Al Jaber is the CEO of Adnoc, the UAE’s state oil company. His job as an oil baron has made the outcome of COP28 appear all the more impressive and trustworthy in some climate coverage. Yet Al Jaber’s Adnoc is not moving away from oil and gas. It may drill a full 42 percent more than it is currently drilling overall by 2030, according to independent analysts. And, as The New York Times reported, the conference Al Jaber presided over is now being praised by fossil fuel companies for having no impact on their capacity to sell coal, oil, and gas. Saudi Arabia’s oil minister in particular celebrated the fact that “dictating” targets for reducing emissions or halting global heating at a certain temperature “has been buried” at COP28 and that his country and its concerns “were given priority that I don’t think I have ever seen.” The petrostate hosts of the climate talks were not allied with nations calling for a phaseout of fossil fuels—what the science says must happen if the world is to preserve a mostly livable climate—but a partner to the other petrostates that share its business interests.
What does this say about how to understand the language of climate politics? Moving forward, journalists—and citizens as well—should recognize that oil and gas producers increasingly sound like climate advocates, using the same words and phrases that call for the end of the fossil fuel era. This is their new greenwashing strategy. It is all the more important never to take anyone’s words at face value, but to interpret them in the context of an entire statement—whether an industry advertisement, a think-tank report, or a text from U.N. climate talks—assessing that statement in relation to both the latest climate science and actual industry investments. Propaganda shouldn’t be amplified. It should be exposed.
Climate advocates can take a slightly different tack. If fossil fuel producers are appropriating the language of advocates for their greenwashing, advocates can steal their language right back again. As Bill McKibben said in his commentary on COP28: The phrase “transition away from fossil fuels” is now “a tool for activists to use henceforth.” No longer are the hippies the only ones saying that the fossil fuel era must end. The world’s nations have now publicly acknowledged that too, giving advocates new legitimacy and power in “every discussion from now on—especially the discussions about any further expansion of the fossil fuel energy,” as McKibben put it.
Anyone who cares about the future can get even more targeted by grasping one little word out of the COP28 text as a rhetorical weapon against fossil fuel propaganda: the word “away.” That evocative word, which describes leaving something behind, offers civil society and governments a hard benchmark for both climate speech and climate action. Does that speech and action sustain, justify, excuse, or promote fossil fuels? Or does it transition, move, innovate, or legislate away from them? These questions can be answered with a clarity that not even the phrase “phaseout” can provide. The text countries agreed on at COP28 may be a masterclass in greenwashing, but it may also contain the seeds of its own undoing.
THE HAGUE, Netherlands (AP) — Dutch bank ING announced Wednesday that it is accelerating its phasing out of funding for oil and gas exploration and production activities while it increases financing for renewable energy.
ING has faced fierce criticism from Dutch climate activists for its funding of fossil fuel companies.
The ING announcement came a week after nearly 200 countries at the COP28 climate meeting in Dubai agreed to move away from planet-warming fossil fuels in a document that critics said contained significant loopholes.
ING said its loans to oil and gas exploration and production activities will be cut by 35% by 2030 and 10 years later “the financed emissions linked to our portfolio will be reduced to zero.” Meanwhile, the bank said, it will raise financing of renewable power generation to 7.5 billion euros ($8.2 billion) annually by 2025 from 2.5 billion euros ($2.7 billion) in 2022.
“The world needs energy, but still too much of that is coming from fossil fuels," ING CEO Steven van Rijswijk said in a statement.
Greenpeace in the Netherlands called the announcement a “step in the right direction,” but warned that “our planet is on fire, let's be honest: only stepping away from the fire is not enough as long as you keep fanning the flames.”
2024 will put COP28’s goals to the test
Tim McDonnell
Wed, December 20, 2023 at
The Facts
The headline-grabbing promise of the COP28 agreement — that countries will endeavor to “transition away from fossil fuels” — doesn’t come with a specific deadline. But another part of the agreement does. The deal says annual global greenhouse emissions need to peak by 2025 to stay within the global warming limit of 1.5 C. That means for the biggest emitters, 2024 will be a critical turning point for the energy transition, in which it will either speed up or miss the window of opportunity to keep 1.5 C within reach.
Tim’s view
This year was a challenging one for the energy transition, pitting the human and economic costs of climate change against the big picture conditions of the global economy — war and nationalism, high inflation and interest rates — that tend to favor the fossil-fuel status quo. Those headwinds are unlikely to let up in 2024. These are the big questions that will shape whether COP28’s aspirations will remain within reach.
Will global climate trade wars continue to heat up? Next year will be the first that European importers of industrial products like aluminum and fertilizer will need to report the carbon footprint of those goods. That reporting requirement will put pressure on suppliers around the world to start to decarbonize or risk losing market access when the EU’s carbon border tariff goes into full effect in 2026. The U.K. has outlined plans for its own version, and expect to see more political momentum to erect similar barriers in the United States. Meanwhile, Western companies and governments will continue to try to undermine China’s vise grip on the supply chains for critical minerals and clean energy hardware, which could drive prices up in the near term, especially if Beijing weighs additional export restrictions of its own.
Can clean-energy investors recover their nerves? Even though the costs of solar power hardware have fallen to record lows, and there have never been more government incentives for clean energy, investment in the sector is at risk of stalling out. Rising borrowing costs make the economics of renewable energy projects less attractive, and U.S. regulators are weighing new banking rules that could restrict lending even more. Share prices of clean energy companies have suffered this year, and in 2024 global clean energy investment could fall 9%, according to a forecast this week by the Swedish bank SEB. But the story isn’t all bad. Climate tech is drawing a growing share of venture capital investment, and there is enormous appetite from high-emitting companies to acquire decarbonization solutions. Climate removal tech had a banner year in 2023, and will probably have another in 2024. Investment in clean energy manufacturing facilities in the U.S. has been growing steadily and will likely continue next year as well.
Will EVs reach a sales tipping point or sit on dealer lots? Starting Jan. 1, most electric vehicles for sale in the U.S. will lose eligibility for the full $7,500 tax credit they qualified for this year, as rules to exclude China-produced components become more strict. Sales are expected to continue rising anyway, but at a slower pace, according to BloombergNEF: A 32% gain in 2024, compared with 47% in 2023. That leaves major automakers in a bind, as they struggle to set the right pace for their EV investments. EVs are piling up on dealership lots. But automakers are still engaged in a protracted price-cutting war to defend their market share against discount EV options from China. Those price cuts, plus a loophole that allows leased EVs to remain eligible for tax credits, along with the plummeting costs of batteries, will all be wins for consumers in 2024. And they’re a powerful driver of the transition away from fossil fuels, as the electrification of transportation takes a major bite out of oil demand.
How will oil and gas companies balance current demand with long-term investment risk? biggest long-term gas contract
Can the transition survive the U.S. presidential election? If Donald Trump wins another stint in the White House, it will set up a test of how resilient the long-term energy transition is to short-term politics. Clean energy is much cheaper than it was during Trump’s first term, and the Inflation Reduction Act has driven a surge in onshoring and re-industrialization that make the economic benefits of the transition much more tangible to more voters. So to some extent, there may be a limit to how much damage Trump can do. But there are plenty of areas where his administration could impede climate progress: Trump may be unwilling or uninterested in finding a bipartisan solution to permitting reform; he could toss or simply not enforce Biden-era emissions regulations from the Environmental Protection Agency; and could withdraw the U.S. from the Paris Agreement and from climate-focused trade deals with the EU.
The View From India
For countries in the global south, a key determinant of when they’ll hit peak emissions is foreign investment and financial aid. The COP28 agreement was roundly criticized by developing country governments for being vague and noncommittal about climate finance, essentially letting the U.S. and other rich big emitters off the hook for underwriting developing countries’ adoption of clean energy. The UAE and other Gulf oil exporters, meanwhile, seem more than happy to fill that development finance void with investments in fossil fuel infrastructure, for example with a $50 billion investment to build the world’s largest oil refinery in India. If the U.S. can’t step up its climate finance game, in other words, it risks not just undermining decarbonization in the countries with some of the fastest growing populations and energy demand, but also giving up significant geopolitical leverage.
The Secret Weapon of Climate Negotiations: Language
Genevieve Guenther
Tue, December 19, 2023
In the week since the twenty-eighth Conference of the Parties, or COP28, climate talks wrapped up, media coverage of the outcome has been largely positive. That coverage has focused on the statement produced at the end of the conference, which “calls on” participating nations to “contribute” to the “transitioning away from fossil fuels in energy systems.” This marks the first time since the inaugural COP of 1995 that a final text actually mentions the words “fossil fuels.” Not even the 2015 Paris Agreement acknowledged that coal, oil, and methane gas are the root causes of climate change.
Insofar as commentators have criticized the consensus text negotiators reached in Dubai last week, they’ve noted that it lacks both ambition and teeth, since it calls merely for a “transition away” from fossil energy, when it should call for “drastic immediate emission cuts and binding commitments from the largest contributors of the climate crisis to finance loss and damages” and adaptation, as Greta Thunberg put it.
But the problem with the outcome of COP28 is not only that it’s weak. It’s that the statement is a masterclass in propaganda, upholding two prevalent and pernicious forms of greenwashing that support expanded coal, oil, and gas production: the false claim that the world can continue to use fossil fuels and still halt global heating and the equally false, if more subtle, claim that fossil-energy companies are trustworthy partners in the fight to preserve a livable climate. The positive coverage of COP28 shows that this greenwashing has succeeded in obscuring what really happened in Dubai.
How does a text that calls on nations to contribute to the “transitioning away from fossil fuels” uphold the idea that the world can continue to use them? That seems like a paradox. Yet this is the paradox inherent to greenwashing itself. Actions to uphold the fossil fuel status quo are trusted because they look like efforts to make change.
This dynamic is front and center in the COP28 decision text. First, let’s look at what the text demands: It “calls on” parties (i.e., nations who are “party” to the U.N. Framework Convention on Climate Change) to “contribute to ... transitioning away from fossil fuels in energy systems.” This may sound robust, but under UNFCCC guidelines, the verb “calls on” is the weakest possible request to the parties. It is truly a take-it-or-leave-it suggestion. And the text never defines what counts as a “contribution” to transitioning away from fossil fuels. Could a government merely establish a task force to study low-carbon energy systems and count that as a contribution? Going by this text, yes!
This same vagueness bedevils the text’s language on coal power, which “calls on” parties to contribute to “accelerating efforts towards the phase down of unabated coal power.” There are many levels of delay here: First, nations must respond to the call, then they must contribute to “accelerating efforts,” and then those efforts will move “towards” (but not achieve) the “phase down” rather than the “phaseout” of unabated coal power. (“Phaseout” implies eventually ceasing entirely; “phase down” does not.) It is worth noting also that “unabated” is yet another undefined term, implying that coal that is abated, i.e., that is offset somehow, is OK. This allows countries to claim without verification that they have offset their climate pollution.
So, yes, COP28 negotiators agreed on “transitioning away from fossil fuels,” but the vagueness of that goal, and its position at the end of a series of delaying steps, enables the governments involved to continue to promote expanded coal, oil, and gas production while still claiming to be following the letter of the text.
Even worse, the text actually provides support for fossil fuels when it “recognizes that transitional fuels can play a role in facilitating the energy transition while ensuring energy security.” Of course, providing parties with maximum interpretive flexibility, the text does not define “transitional fuels,” but historically methane gas has been represented as a “transition fuel” because it puts less carbon dioxide into the atmosphere than coal does.
Methane gas is itself a fossil fuel and a significant contributor to climate change; in the short term it forces more global heating than carbon dioxide does. Recent scientific studies have shown that when leaks from methane gas extraction, refining, and combustion are accounted for, methane gas is actually worse for the climate than coal. So any text that calls methane gas an element of the transition away from fossil fuels is in effect justifying many billions of tons more greenhouse gas pollution, virtually guaranteeing that the world will not achieve net-zero emissions in time to halt warming well below two degrees Celsius (3.6 degrees Fahrenheit).
Of course the United Arab Emirates, the host country of the conference, and Sultan Al Jaber, its president, celebrated the outcome as a great victory, calling it the “UAE Consensus” that will guide international climate action moving forward. Al Jaber called the text drafted at COP28 a “historic achievement” and a “paradigm shift.” This self-promotion is not just political theater but also the second form of greenwashing that currently retards progress in phasing out fossil fuels: the pretense of oil and gas executives and companies that they’re trustworthy partners in the energy transition.
Al Jaber is the CEO of Adnoc, the UAE’s state oil company. His job as an oil baron has made the outcome of COP28 appear all the more impressive and trustworthy in some climate coverage. Yet Al Jaber’s Adnoc is not moving away from oil and gas. It may drill a full 42 percent more than it is currently drilling overall by 2030, according to independent analysts. And, as The New York Times reported, the conference Al Jaber presided over is now being praised by fossil fuel companies for having no impact on their capacity to sell coal, oil, and gas. Saudi Arabia’s oil minister in particular celebrated the fact that “dictating” targets for reducing emissions or halting global heating at a certain temperature “has been buried” at COP28 and that his country and its concerns “were given priority that I don’t think I have ever seen.” The petrostate hosts of the climate talks were not allied with nations calling for a phaseout of fossil fuels—what the science says must happen if the world is to preserve a mostly livable climate—but a partner to the other petrostates that share its business interests.
What does this say about how to understand the language of climate politics? Moving forward, journalists—and citizens as well—should recognize that oil and gas producers increasingly sound like climate advocates, using the same words and phrases that call for the end of the fossil fuel era. This is their new greenwashing strategy. It is all the more important never to take anyone’s words at face value, but to interpret them in the context of an entire statement—whether an industry advertisement, a think-tank report, or a text from U.N. climate talks—assessing that statement in relation to both the latest climate science and actual industry investments. Propaganda shouldn’t be amplified. It should be exposed.
Climate advocates can take a slightly different tack. If fossil fuel producers are appropriating the language of advocates for their greenwashing, advocates can steal their language right back again. As Bill McKibben said in his commentary on COP28: The phrase “transition away from fossil fuels” is now “a tool for activists to use henceforth.” No longer are the hippies the only ones saying that the fossil fuel era must end. The world’s nations have now publicly acknowledged that too, giving advocates new legitimacy and power in “every discussion from now on—especially the discussions about any further expansion of the fossil fuel energy,” as McKibben put it.
Anyone who cares about the future can get even more targeted by grasping one little word out of the COP28 text as a rhetorical weapon against fossil fuel propaganda: the word “away.” That evocative word, which describes leaving something behind, offers civil society and governments a hard benchmark for both climate speech and climate action. Does that speech and action sustain, justify, excuse, or promote fossil fuels? Or does it transition, move, innovate, or legislate away from them? These questions can be answered with a clarity that not even the phrase “phaseout” can provide. The text countries agreed on at COP28 may be a masterclass in greenwashing, but it may also contain the seeds of its own undoing.
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