The End is Near for Dirty Energy: Fossil Fuels are Being Abandoned by Investors, Insurers and Banks

“I’m done with fossil fuels. They’re done. They’re just done. We’re starting to see divestment all over the world.” - CNBC’s Jim Cramer

The fact that investors, insurance companies and banks are abandoning the fossil fuel industry is a clear sign that coal, oil and gas are in the final stage of their energy dominance. Those who refuse to come to terms with this fundamental reality will by punished financially and in the court of public opinion.

Islamic Banks and Renewable Energy in MENA

Islamic banking involves activity that is consistent with the principles of sharia law. Sharia prohibits the fixed or floating payment or acceptance of specific interest or fees for loans of money. It is also prohibited to invest in businesses that provide goods or services considered contrary to Islamic principles. Many Islamic banks were formed in the late 20th century. Now Islamic banks are are increasingly looking to support renewable energy including hydropower, solar and wind energy. Finance is a crucially important component of building a green infrastructure and this is especially true in the context of economic difficulty and political volatility we are seeing in the Middle East and North Africa (MENA).

The G20 and the Transition to a Greener Economy

The G20 has a pivotal role to play in support of the development of a more sustainable economy. This entails sustainable green growth powered by clean technologies and respect for nature's biodiversity.

Already some international efforts are underway. The World Bank, in partnership with organizations including UNEP, will be assisting developing countries with national, green accounts. But there are still major obstacles that need to be overcome, not the least of which is subsidies for the oil industries and certain fisheries. Subsidies use tax dollars that cause global warming and depletion of dwindling fish stocks.

Global subsidies that contribute to climate change total up to $800 billion and over $27 billion goes to fishing subsidies.We need to do more than address the contradictions inherent in existing economic models, public policy and private sector investments must be aligned in ways that meet the short-term recovery challenges with a longer-term vision of opportunity.

A year ago in London, G-20 leaders articulated a vision of an “inclusive, sustainable and green recovery.” By acting in concert and working cooperatively, the G20 can play a central role in making the transition to a low carbon economy.


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Greenpeace's G20 Checklist

Greenpeace International was hoping that the G20 leaders meeting in Seoul would honor the promises they made a year ago on climate action and begin cutting fossil fuel subsidies and helping the world to ramp-up the green economy.

In a recent statement, Patricia Lerner, Greenpeace International Senior Political Adviser said, 'This G20 (meeting) is supposed to give a strong signal of support for the upcoming climate talks in Cancun (Mexico), but instead we understand there are moves afoot to backtrack on commitments made a year ago."

Greenpeace issued a G20 checklist that including honouring their promises on climate, closing the gap between industrialised country emission reduction commitments and what the climate science demands. Leaders must also create the financial and regulatory conditions that incentivise a green economy, and agree on the indicators and reporting mechanisms needed to monitor progress.

Another key issue committed to by G20 leaders in Pittsburgh last year and reported on in Toronto earlier this year was the phase-out of subsidies to the fossil fuel industry. A Greenpeace report, written by the Global Subsidies Initiative, reveals a lack of transparency around fossil fuel subsidies. The review recommends that the focus should be on a much wider range of issues than merely revenue maximization.

Greenpeace also called on G20 leaders to invest in climate finance, switch to clean energy and stop deforestation. 'These governments have a choice: They can lead the world to a clean energy future, safe from the ravages of climate change' or they can continue to subsidise the oil industry and accept the human and economic consequences of dangerous climate change,' Lerner said.


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