G7 invests in fossils as much as it invests in EE

Greenpeace analysis: Investments in climate-friendly restructuring of the economy should be ten times higher

The G7 countries continue to subsidize climate-damaging energy sources such as coal, oil and gas in large quantities as the expansion of renewable energies. This comes from an analysis (act.gp/3biXlQu) from the New Economy Foundation Greenpeace published on the occasion of the G7 summit starting on June 26, 2022 in Ellmau, Bavaria. According to the analysis, the G7 countries are investing barely ten percent of the minimum amount that would be necessary to achieve the Paris climate targets for an energy transition and climate-friendly restructuring of the economy.

G7 Climate Investment Gap – © greenpeace.de

“Rich industrial nations cannot continue to invest huge amounts of money in energy that destroys all of our livelihoods,” says Greenpeace energy expert Jonas Ott. “The G7 should implement what climate science has been saying for years: If we still want to achieve the 1.5-degree target, we cannot afford more investments in coal, oil and gas. Industrialized countries should direct all the money to expanding renewables.”

Germany must redirect investmentn

The analysis shows a serious mismatch in the German editions. While Germany imported an average of €88 billion worth of fossil fuels from Russia each year between 2015 and 2021, only about €26 billion flowed into the energy transition between 2015 and 2020. According to the analysis, Germany has to invest some At least €119 billion annually in climate-friendly restructuring of the economy so that it can comply with the 1.5-degree limit.

The other G7 countries are also investing very little in the energy transition. The investment gap is particularly large in Italy, the United States, Canada and Japan. In the United States, for example, about $1,400 billion must flow into the energy transition each year, but currently it’s only about $37 billion. At 196 billion, the United States alone spent more than five times that annually importing fossil fuels. “The analysis shows very clearly that the largest industrialized nations are not living up to their responsibility for a climate-friendly world,” says Ott. “The G7 has a mission to invest more in renewables with immediate effect and use its technology expertise to kick-start the global energy transition.”

Ott in the introduction to the study: “With their historical partners₂Emissions, G7 countries bear great responsibility for climate: In order to prevent irreversible climate damage and climate breakdown, the seven richest democracies must fulfill this responsibility and immediately halt all investments in climate-damaging infrastructure for coal, oil and gas. Only if they direct their capital flows and investment away from fossil fuels and toward environmental transformation can they achieve the Paris climate goals.
On the occasion of this year’s G7 summit chaired by the German Council, Greenpeace commissioned the New Economic Foundation (NEF) to investigate the so-called climate investment gap for G7 member states. The result: since 2020, Germany, France, Great Britain, Italy, Japan, Canada and the USA are planning public investments in fossil energies that are almost at the same level as the expansion of solar and wind energy (planned investments in fossil energies: 211.7 billion). €; Planned investments for climate-friendly energy projects: €265.7 billion).
The G7 countries are investing very little for energy transition and climate-friendly restructuring of the economy – well less than ten percent of the total amount of investment that would be necessary to comply with the 1.5-degree limit. In Italy, the United States, Canada and Japan, the climate investment gap is even larger than in other countries.
Germany has to invest about 118.9 billion euros annually to achieve climate-friendly restructuring of the economy. In fact, investments in environmental transformation between 2015 and 2020 totaled approximately €26.4 billion annually, of which €9.8 billion was public funds. For comparison: between 2015 and 2021, Germany imported fossil fuels worth 87.9 billion euros a year on average – 17.2 percent of it came from Russia. In order to comply with the critical 1.5 degree limit, Germany will have to spend nearly twelve times more public and private money on greening than has been invested on average since 2020. On the other hand, climate-damaging investments in new fuel development must be curtailed Fossil and associated investment in infrastructure to zero as quickly as possible.
The present analysis shows very clearly that the largest economic democracies do not live up to their enormous responsibility. They must close the climate investment gap immediately to prevent climate collapse. At the same time, they must use their financial resources and technological know-how to initiate the transformation of the global energy system.”

The central findings of the summary experience:

• None of the G7 countries currently plan for the more than ten percent of the investments in the energy transition and climate-friendly restructuring of the economy that will be necessary to achieve the 1.5-degree target. France, Italy, Japan and the United States are currently planning even less than 2% of the funds required for this.
• Overall, the G7 countries plan roughly from funds for climate-damaging fossil energies (€211.7 billion) to clean energy solutions (€265.7 billion).
• It is clear that total past investment in climate-friendly economic restructuring (2015-2021) and planned future public investment (2020-today) is too low in all G7 countries to meet the 1.5-degree target. The gap between planned and required investments in climate protection is larger in Canada, Japan and the USA.
• Domestic investment: In the years 2015-2021, the USA, Great Britain and Canada in particular made the largest domestic investments in fossil fuels compared to their economic production. In the USA and Canada, in terms of their economic output, domestic investments in fossil energies are also much higher than the publicly planned money and expenditures for clean energy.
• Since 2020, Germany, France and Italy have allocated more funds for public financing of renewable energies than fossil fuels. In absolute terms, the United States, the United Kingdom, and Canada have made the largest investments in fossil fuels over the past two years.
• Compared to their economic output, Germany and France have invested the largest amount in clean energy since 2020.
• However, both countries will have to invest about 12 or 22 times as much in a climate-friendly energy system.
• Germany should quadruple its total annual investment in energy conversion from 26.4 billion euros to at least 118.9 billion euros compared to the past few years. For comparison: in recent years, Germany has bought fossil fuels from abroad for an average of about 88 billion euros per year.

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