The Australian government has been praised for joining a global partnership committed to stopping billions of dollars in foreign aid and loans being spent on fossil fuel expansion, but the decision has also prompted renewed calls for it to reconsider polluting subsidies at home.
The Albanese government announced at the Cop28 climate summit that it had joined 40 other countries in signing up to the clean energy transition partnership, an agreement first reached in Glasgow two years ago.
It aims to create new rules to end international financing of fossil fuels across the OECD, and commits signatories to phasing out their offshore support for coal, oil and gas within 12 months.
Australia has a long history of financing fossil fuel projects through its export credit agency, Export Finance Australia. Between 2009 and 2020 it spent $1.7bn on coal, oil and gas developments and just $20m on renewable energy, according to research by the Jubilee Australia Research Centre.
The Albanese government had already indicated it would stop supporting fossil fuels overseas, but the announcement is seen as a formalisation of that commitment. The foreign affairs minister, Penny Wong, said it was a step in Australia aligning its position on international financing with Pacific countries.
In a statement before flying to Cop28 in the United Arab Emirates on Wednesday, the climate change and energy minister, Chris Bowen, said it showed Australia was “finally being taken seriously as a constructive international trading partner and investor determined to take meaningful action on climate change”.
Activists praised the commitment and said more should follow. James Sherley, climate justice campaigner at the Jubilee Australia Research Centre, said the government had taken a “long overdue step”.
“We welcome this announcement as potentially a first step on the road to phasing out fossil fuels,” he said. “To deliver on its promise will require strong implementation, which we will be watching closely.”
Greenpeace Australia Pacific’s head of advocacy, Susie Byers, said it was a “massive step forward”.
“It sends a strong signal that the Australian government is serious about rebuilding its reputation on the global stage and is ready to step up to show what true climate leadership in our region can look like,” she said.
“Now, this must translate into action at home. It’s time for Australia to turn the tap off on the billions of taxpayer dollars poured into the fossil fuel industry every year and to stop approving new fossil fuel projects, including Woodside’s Burrup hub.”
The Australian Conservation Foundation described Australia’s support for the partnership as a positive step that would help accelerate the worldwide transition from fossil fuels to renewables, but said this year’s federal budget included $50bn in fossil fuel subsidies over the next four years, including $41bn for a fuel tax rebate for off-road vehicles.
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“The next step must be to stop subsidising the expansion of coal and gas at home,” the foundation’s climate and energy program manager, Gavan McFadzean, said.
The nearly 200 countries at the summit are negotiating over a proposed Cop28 consensus agreement. Draft text of the deal includes proposed text that fossil fuels should be phased out or down.
Speaking on ABC Radio’s AM on Wednesday, Bowen said he would support a “properly phrased move” towards language that fossil fuels should be phased out across the globe.
Australian government submissions to the UN have previously indicated support for a phase out of “unabated fossil fuels” – that is, fossil fuels that do not have their emissions cut in some other way.
But Bowen told the ABC that China and African countries had already said they were not comfortable with “phase out” language, and the negotiations were difficult.
Previous climate summits have agreed only to a phase down of unabated coal power, and a phase out of “inefficient” fossil fuel subsidies. Oil and gas were not specifically mentioned.
Bowen said he would push for stronger language. “We need to see a step up in global action on mitigating emissions,” he said.
Asked about controversy over comments by the Cop28 president, Sultan Al Jaber, that there was “no science out there, or no scenario out there, that says that the phase-out of fossil fuel is what’s going to achieve [limiting global heating to] 1.5C”, Bowen said he could only speak from his personal experience, and that had been positive.
“I get WhatsApp messages from him all the time asking about Australia’s view on various things, he wants a good outcome,” Bowen said.
A report by the Global Carbon Project released on Tuesday found greenhouse gas emissions from fossil fuels reached record levels this year. Experts warned the projected rate of warming had not improved over the past two years.