A natural gas well in the Bakken Formation of North Dakota flares at night
Natural gas wells, like this one in North Dakota, are some of the prime beneficiaries of the $72 billion invested in fossil fuel policies by the United States in 2020. Credit: Joshua Doubek/Wikimedia, CC BY-SA 3.0
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With a commitment of $72.35 billion since the beginning of the year, the United States has pledged the most money to fossil fuels among nations of the G20, according to a first-of-its-kind tracker released earlier this summer.

The continued U.S. investment in fossil fuels exposes the vulnerabilities of the Paris Agreement, says Tejal Kanitkar, an associate professor of natural sciences and engineering at the National Institute of Advanced Studies, Bengaluru, India. In 2019, the United States announced plans to withdraw from the international agreement, which sets a framework to keep the increase in global average temperature to below 2°C above preindustrial levels and to pursue efforts to limit the increase to 1.5°C, recognizing that this limit would substantially reduce the risks and impacts of climate change

Fossil Unconditional

The Energy Policy Tracker is designed to provide information and analysis of the flow of trillions of dollars in public finance, including COVID-19 recovery packages, across the G20. It was prepared predominantly by six organizations: International Institute for Sustainable Development (IISD), Institute for Global Environmental Strategies, Oil Change International, Overseas Development Institute, Stockholm Environment Institute, and Columbia University. It was last updated on 2 September.

The tracker classifies funds across five categories: fossil unconditional, fossil conditional, clean unconditional, clean conditional, and other energy.

Anjali Viswamohanan, an IISD associate who worked on the tracker database, explained that “fossil unconditional” polices describe those that do not take into account climate targets or pollution standards. An example of fossil unconditional funding is the U.S. tax credit for natural gas manufacturers announced in July.

At $39.35 billion, the United Kingdom, host of the 2021 United Nations Climate Change Conference (COP26), ranks second in terms of fossil unconditional funding. An example of this funding is the 113 licenses awarded on 3 September to offshore oil and gas projects. This funding is “incompatible with the Paris Agreement,” said Greg Muttitt, a U.K.-based energy researcher. In 2019, Muttitt was part of a team that showed the United Kingdom was already well above its share of the carbon budget as estimated by the Intergovernmental Panel on Climate Change.

It is “hypocritical for the U.K. to be hosting a major COP and, at the same time, awarding 113 licenses to explore and extract oil and gas,” Muttitt said.

Other Classifications

Policies classified as fossil conditional are those that push for investments in fossil fuels but are based on conditions like emissions reduction targets. For example, the government of Alberta, Canada, is providing Can$58 million to support natural gas, including investment in technology and innovation to lower emissions.

Overall, the G20 committed at least $171.56 billion to oil and gas, of which at least $156.76 billion has been pledged unconditionally. Of that, at least $14.61 billion has been pledged to coal, of which at least $9.87 billion has been pledged unconditionally.

As for clean energy, the G20 has invested at least $50.19 billion toward unconditional clean energy and at least $88.59 billion toward conditional clean energy. Viswamohanan explained that unconditional clean energy indicates policies that push investments into completely clean energy, whereas conditional clean energy refers to policies that promote mixed sources of energy like hybrid electric vehicles.

“The Developed World Must Show Leadership”

Many grants, rebates, and other policies aimed at the fossil fuel industry are a part of economic relief from the COVID-19 pandemic. In the United States alone, more than 5,600 companies in the fossil fuel industry have taken a minimum of $3 billion in coronavirus aid from the federal government. Industry groups and politicians encouraged “broad and flexible” federal aid distribution to businesses hurt by coronavirus lockdowns. The coal industry, for example, idled or closed several mines, which resulted in job losses and slowed production. The United States pledged about $122 million in unconditional funding to the coal industry.

“[The] COVID-19 [crisis] cannot be an excuse for developed nations in particular to extend support to the fossil fuel industry,” said Meena Raman, a senior researcher at Third World Network, a nonprofit international research and advocacy organization focusing on the Global South with an aim toward fair distribution of the world’s resources.

“There is this notion that the G20 countries must do more in terms of emissions reduction, but you can’t lump all the G20 nations together,” Raman said. She added that one shouldn’t put India and Argentina in the same basket as the United States and the United Kingdom because such grouping “ignores historical responsibilities.”

The fact that developed countries are not doing enough in accordance with principles of equity underlined in Article 3(1) of the United Nations Framework Convention on Climate Change “is a long-standing issue,” Kanitkar said.

“We [Third World Network] believe that all nations should do more [to meet climate targets], but we also believe that the developed world must show leadership because the transition [to clean energy] must be just,” Raman added.

—Rishika Pardikar (@rishpardikar), Science Writer

This story is a part of Covering Climate Now’s week of coverage focused on “Climate Politics 2020.” Covering Climate Now is a global journalism collaboration committed to strengthening coverage of the climate story.


Pardikar, R. (2020), The G20 is investing in fossil fuels, Eos, 101, https://doi.org/10.1029/2020EO149463. Published on 24 September 2020.

Text © 2020. The authors. CC BY-NC-ND 3.0
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