In 2023, Switzerland joined an international agreement pledging to end all taxpayer financing for fossil fuels. But recently, the country was exposed for having broken that promise, Oil Change International reported.
What's happening?
In June, Switzerland's Swiss Export Risk Insurance (SERV) quietly replaced the previously signed agreement of the Clean Energy Transition Partnership (CETP) with a much more lenient one. The new agreement allows dirty energy financing to continue and opens several loopholes that essentially give SERV unlimited authority to authorize dirty energy projects, Oil Change International reported.
Not only did SERV water down the climate pledge — it's pumping money into the dirty energy industry, per Oil Change International. In fact, the outlet notes, Switzerland has now surpassed the United States in oil financing and "approved the most fossil fuel finance of the CETP signatories since the agreement took effect, providing a total of almost $3.6 billion for five fossil fuel projects."
Why is this violation of the CETP so concerning?
We're at a critical moment in climate history when adherence to agreements like CETP is crucial to slow down the deadly rise of global heating (explained here by the Natural Resources Defense Council). In short, it is not a time to break promises.
"Other countries have kept their promise to end international public finance for fossil fuels. There is no time to lose," said Adam McGibbon, Public Finance Strategist at OCI, in a statement. "Public money that should be going to support a just transition to renewable energy is instead being pumped into more climate-wrecking fossil fuel projects, harming communities."
Unfortunately, while Switzerland has now surpassed CETP members in oil financing, plenty of politicians are still undoing the work of their climate-minded counterparts. For example, Louisiana recently gained federal approval for a massive new natural gas plant and pipeline, and Virginia's governor rolled back pollution regulations on the auto industry.
"Our home is burning, but Switzerland is adding fuel to the fire with billions in taxpayer finance for fossil fuels," McGibbon emphasized. "No scientific basis was provided for this change, because none exists."
What's being done about fossil fuel financing?
Politicians and advocates hope that international pressure will force SERV back into compliance with the CETP standards, according to OCI. Even in countries where the CETP is still in effect, it will be crucial that both governments and massive corporations continue to adhere to its regulations to create a more liveable future.
"Switzerland must take urgent action to end this madness — and they will be held accountable to their promises," McGibbon said.
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