>@United Nations
©United Nations

In the lead up to the COP 26 global climate conference, the European Investment Bank (EIB) is joining forces with the United Nations Development Programme (UNDP) in highlighting the need for urgent fossil fuel subsidy reform.

Hundreds of billions are spent annually to subsidize fossil fuels for consumers - oil, gas, and coal -, which are destroying our planet while hundreds of millions of people live in poverty. The UNDP Don’t Choose Extinction campaign shows how these funds, paid for by taxpayers, end up deepening inequality, impeding action on climate change and, ultimately, subsidizing human extinction. 

By endorsing the campaign, the EIB is joining millions of people around the world who are striving to prevent an unprecedented and irreversible global climate crisis. The endorsement also reflects EIB’s ongoing commitment to raising international support for the global acceleration of the green energy transition.  In 2019, the EIB was the first multilateral development bank to phase out financing for energy projects reliant on unabated fossil fuels. Last year, the bank further reinforced its position by aligning its lending across all sectors to the Paris Agreement.

Ending energy poverty has never been more critical. Nearly 800 million people currently lack access to electricity and 2.6 billion people are living without access to clean cooking. The reform of fossil fuel subsidies would be a crucial step in fighting the climate crisis and moving towards an inclusive, green recovery from COVID-19. 

“To stand a chance of limiting global warming, the world’s energy systems must transform fast,” said Werner Hoyer, President of the EIB. “To accelerate the clean-energy transition, public financial institutions must mobilise international support for new technologies and their adoption at scale. There is a clear economic development case for redoubling our efforts: Wind and solar are now cheaper than new coal and gas power plants in two-thirds of the world.”

“The COVID-19 pandemic has exposed many antiquated aspects of the global economy. The world continues to spend billions of dollars on fossil fuel subsidies, while hundreds of millions of people live in poverty and the climate crisis accelerates. As “code red” for humanity flashes, the science tells us that only the most ambitious decarbonization and climate action will limit global warming to 1.5 degree Celsius, helping to correct the course of both people and planet,” said UNDP Administrator Achim Steiner.

EIB’s support for the Don’t Choose Extinction campaign builds on its ongoing partnership with UNDP, which helps countries access and leverage COVID-19 response financing and better prevent future crises. In October 2021, the two organizations renewed their Memorandum of Understanding from 2016 to jointly address global challenges and share knowledge with each other in areas such as Sustainable Development Goals, climate change and crisis response and migration.

As the world recovers from the pandemic, the EIB welcomes the UNDP initiative and encourages people around the globe to join the campaign.