The commitment to provide £11.6 billion ($14.7bn) between 2021 and 2026 was first made by former prime minister Boris Johnson in 2019. It was repeated again by prime minister Rishi Sunak at Cop27, where he said it was “morally right to honour our promises”.

But, according to an internal government document seen by The Guardian, the UK has constantly underspent and would now find it a “huge challenge” to respect that pledge.

A government spokesperson refuted the claims, saying the UK is still committed to the pledge and delivering on it.

They said the UK spent £1.4 billion on international climate finance over the course of the 2021-22 financial year. This is less than the average £2.32 billion a year which would need to be provided up to 2026 in order to respect the pledge.

‘Sad’ climb down

A source within the African Group of Negotiators told Climate Home News “the news is disappointing, especially since the UK, while Cop26 president, took up a very promising leadership role and breathed hope and trust in the process”. They added that “to climb down from the pledge is unfortunate and sad, especially for developing countries bearing the brunt of the climate crisis”. 

The sentiment was echoed by Madeleine Diouf Sarr, chair of the Least Developed Nations group, who said climate finance “must be scaled up, not back”, highlighting rich countries’ ongoing failure to provide $100 billion a year in climate finance by 2020. Originally made in 2009, that pledge has not yet been respected.

Our people bear the brunt of the climate crisis & need support more than ever to address its escalating impacts. Already not meeting the $100 bn/yr goal, #ClimateFinance must be scaled up, not back. Global solidarity and cooperation remain critical for tackling #ClimateChange https://t.co/djfl3JMbrN

— LDC Chair (@LDCChairUNFCCC) July 5, 2023

“[Our people] need support more than ever to address its escalating impacts,” Diouf Sarr added in a tweet. “Global solidarity and cooperation remain critical for tackling climate change”.

Aid cuts

Former prime minister Boris Johnson vowed in 2019 to double the amount of international climate finance destined for projects to cut emissions in developing countries and help them adapt to the effects of climate change. The UK spent £5.8 billion on the programme in the five years up to 2021. 

But, since the pledge was made, the UK cut aid spending to 0.5% of GDP, down from 0.7%. Some climate initiatives immediately felt the impact of the budget cuts. A programme protecting poor communities around the world from floods and fires had its budget slashed by 70%. At the time, its lead in Nairobi, Joanes Atela, warned this would “directly harm the life chances of the most vulnerable”.

In order to meet the £11.6 billion pledge, government officials have calculated that it would have to spend 83% of the total overseas aid budget on the international climate fund and “squeeze out room for other commitments”, the Guardian reported.

Shipping set to boost climate targets

Another government document reported on by the British newspaper suggests underspending is set to continue. A civil servant from the department in charge of the programme wrote in a note that spending for 2022-23 was £1.3 billion and initial analysis of business plans put the figure for 2023-24 at £1.58 billion. This is below the trajectory set by the government, according to the report.

The publication of the documents’ content follows the resignation last Friday of Zac Goldsmith, a foreign office minister, over what he described as prime minister Rishi Sunak’s “apathy” towards climate change.

Broken trust

Bolivia’s Diego Pacheco, who represents the Like-Minded Developing Country coalition, told Climate Home News the news “will continue undermining the trust in the UNFCCC process”. He also claimed this is “part of the same behavior not aligned with the respect of the Convention and its Paris Agreement”, pointing to disappointment with the UK’s role in securing a Glasgow Climate Pact he described as “without equity”.

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The looming threat of a broken pledge is likely to sow further divisions between developed and developing nations at a time when tension is already running high at climate talks.

In Bonn last month negotiations teetered on the brink as the two camps fought for nine days over the inclusion of emissions reduction measures and climate finance in the agenda. In the end, they reached a compromise rescuing the talks but leaving many disappointed. 

Future implications

A row back on the previous pledges could also stoke fears over rich nations’ future commitments under current considerations. Countries are discussing how the loss and damage fund, secured at Cop27 last year, should be filled. A future climate finance pledge, building on the $100 billion a year one, is also being talked about. 

Laetitia Pettinotti, an economist at Overseas Development Institute (ODI), says the UK’s breaking its promise would have “really stark implications” as it sends the wrong signals to the ongoing negotiations. “The UK is already among the laggards in climate finance,” she added, “this would be the final straw after years of distrust”.

The UK has so far only provided 55% of its “fair share” under a calculation done by the ODI that includes the size of its economy and historical emissions.

The post Developing nations decry risk of UK breaking climate finance pledge appeared first on Climate Home News.

Under a “flexibility mechanism” approved by members of the energy investment treaty, the EU and UK will end protection for new fossil fuel investments from August 2023. However, most existing fossil fuel investments will continue to be protected for 10 years from the date the modernised treaty is officially ratified.

The ECT, which has members spanning Europe and Asia, has been used by fossil fuel companies to sue governments over climate policies which hurt their profits. For example, German energy company Uniper is suing the Dutch government over its coal phase-out plans.

In 2020, a study found that ECT member countries faced up to €1.3 trillion ($1.4trn) by 2050 of compensation claims by fossil fuel investors.

The EU initiated “modernisation” talks to try and end these lawsuits but its attempts to remove fossil fuels from the treaty’s protection clause were thwarted by some Asian nations led by Japan.

At an ad-hoc conference, which was disrupted by protesters yesterday, members to the treaty reached a compromise which gives them some flexibility to choose what energy investment they want to continue to protect.

STOP PROTECTING FOSSIL FUELS! Extinction Rebellion & @wemoveEU have blocked the entrances to the toxic fossil fuel treaty (the ECT) building with a climate crime scene.
4 years of talks on the ECT must end today with the only viable conclusion: end the ECT now! #NoECT #ExitECT pic.twitter.com/iGFaA9Tx9L

— Extinction Rebellion Belgium (@XR_Belgium) June 23, 2022

Members like Japan, a staunch defender of the ECT, is likely to keep protecting fossil fuel investments in the country indefinitely. But the EU and the UK have said they will use the flexibility mechanism to limit them.

When the EU and UK end protections for fossil fuel investments for fossil fuel investors from ECT states like Japan then those states are likely to reciprocate, meaning European and British fossil fuel investments will no longer be protected in countries like Japan.

In Europe, environmental campaigners, who have repeatedly called on the EU to leave the treaty, reacted angrily, calling on ECT members to stage an on-mass exit from the treaty despite the reforms.

Former ECT employee turned anti-ECT campaigner Yamina Saheb told Climate Home the agreement was “a disaster from a climate change perspective”. Friends of the Earth’s Paul De Klerck said it would “lock the EU in fossil fuel investment protection” for a decade.

“This means countries will continue to spend taxpayers’ money in compensating fossil fuel companies rather than fighting climate change and moving to a renewable energy system,” added Cornelia Maarfield, trade and investment policy expert at Climate Action Network Europe. “This disastrous agreement must not be ratified,” she said.

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The ten year protection for existing coal, oil and gas investments was a compromise reached between EU member states, which diverged on the best way forward, according to sources familiar with the negotiations. France, Spain and Luxembourg wanted to end the protection of fossil fuel investments that allows countries to be sued for damages by polluting companies. But several Eastern European states resisted change.

Under the agreement reached, some gas-fired power plants will continue to receive investor protection beyond the 10-year deadline and until the end of 2040. That applies to gas power plants whose emissions are under a certain level and which replace more polluting infrastructure.

The flexibility mechanism would have allowed the UK to end all fossil fuel protection immediately. But it hasn’t done so. Asked why, an energy ministry spokesperson declined to comment.

In a statement published Friday, the UK said protection for existing coal investments in the country will end in October 2024. But, in line with the EU, it will wait 10 years to end protection for oil and gas investments. It will continue to protect abated gas, which uses carbon capture technology, beyond those 10 years.

“Our success in negotiating a modernised treaty will boost our move to cheaper and cleaner energy by providing greater confidence to the private sector investors and risk takers we need for this transition,” said UK energy secretary Greg Hands.

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Campaigners’ call to leave the treaty found some sympathy in EU member states. A Spanish government representative told an EU council meeting in April that Spain “did not see how the ECT could be adapted to the Paris Agreement” and deputy prime-minister Teresa Ribera recently told Politico: “It is time that the EU and its member states initiate a coordinated withdrawal from the ECT”.

But the treaty’s ‘sunset clause’ makes leaving difficult as its rules continue to apply for 20 years after a member decides to leave. Campaigners say the impact of this sunset clause can be greatly reduced if members withdraw on mass and refuse to implement the treaty against each other during that time.

But as well as protecting fossil fuels, the treaty protects renewable investments. Under its rules, renewable companies have claimed compensation for anti-renewable measures. The modernisation talks have led to the addition of protection for carbon capture and storage technology, hydrogen, , ammonia, biomass and biogas.

This article was updated to include the UK government’s decision not to comment.

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