Burning Billions: Record public money for fossil fuels impeding climate action

Governments globally have made bold commitments to address climate change, yet they continue to pour billions of dollars every year into the production and consumption of fossil fuels, the single biggest contributor to the climate crisis. In 2022, public financial support for fossil fuels, in the form of subsidies, investments by state-owned enterprises (SOEs), and lending from public financial institutions, exceeded USD 1.7 trillion globally—a record high.

Under the Paris Agreement, concluded at the 21st United Nations Climate Change Conference (COP 21) in 2015, parties pledged to make "finance flows consistent with a pathway toward low GHG emissions and climate-resilient development" (Article 2.1(c)). At COP 26 in 2021, they promised to accelerate "efforts towards the phasedown of unabated coal power and phase-out of inefficient fossil fuel subsidies."

These commitments have not been achieved. In fact, the data presented in this briefing demonstrates that the gap between commitments and implementation on public financial support has become a yawning chasm.

Parties to the United Nations Framework Convention on Climate Change convening at COP 28 need to commit to phasing out all production and consumption of fossil fuels, set a deadline to shift all public financial flows from fossil fuels to more productive uses, and put in place measures that ensure fossil-dependent communities and energy consumers are supported in a just transition to clean energy.