As more and more countries make concrete domestic decarbonization commitments, it is paramount that national pledges aren’t met by shifting fossil fuel investments overseas.
Inclusive global leadership is needed to accelerate the coal phase-out. The Group of 20 (G20) has an opportunity to commit to limiting all overseas fossil fuel financing, starting with overseas coal finance from the public and private sectors. They should also put in place policy frameworks for disclosure, transparency and just transitions to a low carbon global economy.
In a Communiqué1 issued in May of 2021, the Group of 7 (G7) Climate and Environment Ministers took a step in the right direction by stating that “international investments in unabated coal must stop now.” The G7 also committed “to take concrete steps towards an absolute end to new direct government support for unabated international thermal coal power generation by the end of 2021.” The G7 failed to agree on a specific end date for phasing out coal, but the commitment to restricting international coal investment is a significant step since the Organization for Economic Co-operation and Development (OECD) passed the Sector Understanding on Export Credits for Coal-Fired Electricity Generation2 in 2015, which limited financing for unabated coal in official export credits.