G7 say they won't compromise on climate goals as they tackle fallout of war against Ukraine
The Group of Seven (G7) western economies have reaffirmed their commitment to climate goals amid urgency to tackle the ongoing energy crisis excacerbated by Russia鈥檚 war against Ukraine. During their three-day summit in the Bavarian Alps, leaders agreed to establish a so-called climate club by the end of 2022 and support emerging and developing countries in their transition. But a commitment to ending public fossil fuel financing in third countries came with heavy caveats, leading to criticism from environmental NGOs.
鈥淭his was an important summit in a very special time,鈥� said German Chancellor Olaf Scholz during his final press conference, adding that it had shown the unity of the G7 in its support of Ukraine.
Locked away from public scrutiny with scenic views of the Bavarian Alps, G7 leaders faced an especially challenging cocktail of interrelated crises, particularly regarding energy security, food supplies, climate action, the Covid-19 pandemic, and biodiversity loss. Many of these issues have been aggravated by Russia鈥檚 invasion of Ukraine 鈥� the one crisis that dominated the talks Russia had been a party to until its annexation of Crimea in 2014 and encouraged the G7 to appear strengthened and unified at the summit organised under the aegis of the current German presidency.
While taking immediate action to secure energy supply and stop the increases in energy prices driven by extraordinary market conditions, we will not compromise our climate and biodiversity goals including the energy transition.
Germany had aimed high on climate in the run up to the Elmau summit, promising to make it the top priority during its G7 presidency, but the start of Russia's invasion of Ukraine in February threw plans off course.
The indeed put climate and energy front and centre, starting off with a section entitled 鈥淎 Sustainable Planet鈥�. Leaders reaffirmed their 鈥渦nwavering鈥� commitment to the Paris Agreement, and said they aimed to keep a limit of 1.5掳C temperature rise within reach 鈥� sticking to climate targets despite the escalating energy supply crisis expected especially for European G7 members.
鈥淲hile taking immediate action to secure energy supply and stop the increases in energy prices driven by extraordinary market conditions, we will not compromise our climate and biodiversity goals including the energy transition,鈥� they stated, adding a commitment to overcome the dependency on Russian energy imports.
G7 opens door to public gas sector support, 鈥渃onsistent with climate objectives鈥�
While the G7 countries reaffirmed plans to eliminate inefficient fossil fuel subsidies by 2025, member states introduced strong caveats for their commitment to end public support for fossil fuels abroad.
Scholz had pushed to make public funding of foreign gas projects possible, despite an agreement to the contrary signed at last year鈥檚 COP26. The final text now opens the door to such support but sets some limitations, which observers say are in line with 2021鈥檚 COP pledge.
鈥淭he decision to end financing for fossil fuels stands,鈥� said Scholz. 鈥淗owever, of course we will help countries now in the current situation if they want to make investments into their energy supply, for example if they are hydrogen-ready 鈥� all as long as they are in line with the 1.5掳C [global warming limit] target of the Paris Agreement.鈥� Scholz emphasised that natural gas cannot be a long-term solution and especially not for Germany, which aims to become climate neutral by 2045. However, 鈥済as is needed for a transitional period and that is why there may be investments that make sense in this phase and need to be supported鈥�, the chancellor said.
The final communiqu茅 reads that public support in the gas sector can be 鈥渁ppropriate鈥� in 鈥渆xceptional circumstances [鈥 if implemented in a manner consistent with our climate objectives and without creating lock-in effects鈥�.
Summit 鈥渇ails to send out signal of new beginning in climate policy鈥� 鈥� Germanwatch
For civil society observers, this is the key reason for a rather weak climate outcome of the summit. 鈥淚t is disappointing that the G7 summit failed to send out the signal of a new beginning in climate policy that would have been possible,鈥� Christoph Bals, policy director of Germanwatch told 威力彩玩法. Scholz鈥檚 push for gas financing, however, had meant that 鈥渃limate policy damage control鈥� now stood at the centre.
Johannes Schroeten, policy advisor at think tank E3G, said the G7 wasted a 鈥済olden opportunity鈥� to speed up the end of fossil fuel public finance. 鈥淐hancellor Scholz鈥檚 attempt to carve out large exemptions from the COP26 鈥榮tatement on international public support for the clean energy transition鈥� has been averted 鈥� but only just,鈥� he said. 鈥淭he integrity of the policy stands, but we need urgent clarification of timelines and investment criteria, beyond the empty notion of hydrogen-readiness.鈥�
Greenpeace Germany executive director Martin Kaiser saw a lack of ambitious climate agreements. 鈥淪cholz has failed to initiate the turning point for climate protection in Elmau and there is a lack of clear resolutions to phase out coal and a phase-out date for combustion cars by 2030 and for gas by 2035.鈥�
G7 to establish climate club by the end of 2022
The G7 unveiled plans to establish a climate club by the end of this year, where members would agree on joint rules and standards in the fight against global warming. The club would 鈥渟upport the effective implementation of the Paris Agreement by accelerating climate action and increasing ambition, with a particular focus on the industry sector, thereby addressing risks of carbon leakage for emission intensive goods, while complying with international rules鈥�, .
This was a significant win for Chancellor Scholz, who has been advocating for such a club for some time.
A climate club was necessary, because not enough is done, yet, the G7 argued. 鈥淲e note with concern that currently neither global climate ambition nor implementation are sufficient to achieve the goals of the Paris Agreement,鈥� they said in the document.
The club would be built on three pillars: climate mitigation by working towards a common understanding of how different measures can be made comparable, industry decarbonisation, and boosting international ambition through partnerships and cooperation. The climate club would be cooperative and open to countries which are committed to speeding up action to increase the Paris Agreement.
Observers criticised that the proposal still lacked details. 鈥淭he climate club must be fleshed out with concrete goals and measures,鈥� said Dennis Snower, head of the Global Solutions Initiative.
Mats Engstr枚m, visiting fellow at the European Council on Foreign Relations (ECFR) said the statement on the club is 鈥渁 significant step but much remains to be done, including making sure that it is really inclusive.鈥�
Marian Feist, researcher at the German Institute for International and Security Affairs (SWP), that establishing a club by the end of the year was an 鈥渙ptimistic time frame, given the lack of substance.鈥�
German chemical industry group VCI called the initative to form a climate club "a good thing" that was met with internatinal support. The industry group therefore urged the EU to "shelve its plan to unilaterally introduce border adjustment measures for climate protection and give absolute priority to the climate club."
Climate cooperation beyond G7 through 鈥榡ust energy transition partnerships鈥�
The G7 launched a $600 billion 鈥溾�� for sustainable infrastructure projects in low and mid-income countries 鈥� seen as a response to China鈥檚 so-called Belt and Road Initiative.
In addition, the German presidency had invited several developing countries and emerging economies that are also members of the wider G20 club of influential economies to attend the summit. Following a joint session with the heads of state and government from Indonesia, India, South Africa, Argentina and Senegal, the current chair of the African Union, the G7 leaders that they commit to join forces to accelerate the transition to climate neutrality.
As part of these efforts, the G7 decided to set up more of the so-called 鈥榡ust energy transition partnerships鈥� (JETP), the first of which was announced at last year鈥檚 COP26 with South Africa. These partnerships aim to move forward the transition through financial as well as technical support and capacity building. However, negotiations with Indonesia, India, Senegal and Vietnam are far from finalised and it will likely take months until new JETPs are announced.
NGO Germanwatch鈥檚 Bals welcomed the document by the G7 and the partner countries, but said it was 鈥渙bviously just a starting point鈥�. Bals called it 鈥渦nfortunate鈥� that the leaders only agreed to 鈥減hase down鈥� coal use, not end it entirely.
G7 consider import price caps on oil and gas to prevent Russia from profiting from war
Leaders said they will consider the 鈥渇easibility鈥� of temporary price caps on imports of energy from Russia to prevent Moscow profiting from the war against Ukraine and its fallout, which had seen oil, gas and coal prices rise over recent months.
The idea behind the cap is to tie financial services, insurance and the shipping of oil cargoes to a price ceiling, . A shipper or an importer could only get these if they committed to a set maximum price for Russian oil.
Analyst Luca Bergamaschi of Italian think tank ECCO called the debate on price caps a distraction. 鈥淒evoting a lot of political attention to unclear and likely ineffective or counter-productive "price caps" is a massive waste of time, instead of addressing the demand side to cut costs of consumers and the finance to Putin,鈥� he . In his view, the G7 should focus on energy savings, energy efficiency, renewables and maximising existing infrastructure.
G7 outcome 鈥渘ot sufficient to bridge trust gap with Global South鈥�
Some had seen the German G7 summit as an important stepping stone in the 2022 global climate agenda on the way to COP27 in Egypt later this year. NGOs like Oxfam on the G7 to finally increase climate finance. It is seen as a crucial way to gain support from developing countries for ambitious climate action.
The G7 now said they would intensify efforts to finally make good on their promise to support developing countries with 100 billion dollars in climate finance annually. In addition, they said they would scale up climate and disaster risk finance and insurance and work towards a 鈥淕lobal Shield鈥� against climate risks, with progress to be made by the start of COP27.
ECFR鈥檚 Engstr枚m said Germany had pushed an ambitious climate agenda for the G7 Summit, 鈥渂ut the outcome is not sufficient to bridge the trust gap with the Global South.鈥� The G7 would have to actually deliver on their climate finance promise. 鈥淥therwise the momentum from the Glasgow conference last year might be lost.鈥�
Ella Kokotsis from the G7 Research Group called it "disappointing" that the G7 only reaffirmed their plan to deliver on the 100 billion 鈥渁s soon as possible鈥�.
"Expectations ran high that Elmau would finally deliver on this long-overdue commitment," she said.
