Australia reluctantly agrees to OECD coal finance restrictions

OECD winFinance ministers from the OECD group of wealthy nations have reached an agreement to stop financing the highest polluting new coal power plants. Originally proposed by Japan and the US, the deal ensures that all new coal plants will only eligible for OECD government finance if they have the latest technology and lowest emissions possible, and if cleaner alternatives are unviable.

The deal eventually passed with the necessary support of all 34 member nations, but Australia was a reluctant participant, only entering the agreement after watering it down to allow some small, higher emissions plants in developing countries to be financed.

After it was recently revealed that Australia was planning to block the deal, tens of thousands of Australians lent their voices to the call for Prime Minister Turnbull to ratify the proposed agreement, and the passing of the deal signifies a win for all those who realise that financing dirty new coal power plants is completely at odds with any attempt to contain climate change.

Here’s what out lead campaigner Julien had to say about the deal:

“It’s a huge relief to see this agreement pass, as it sends a signal that coal power plants are becoming increasingly unacceptable, and it’s going to become harder and harder to finance the dirtiest power plants over time.

“The warning sign though is that Australia had to be dragged kicking and screaming to the table, pushed by tens of thousands of Australians calling for action, and intense lobbying from other countries, and only agreed to the deal after being able to water it down.

“The world is looking to move beyond coal, whether the Australian government likes it or not. We have a choice at the upcoming climate talks in Paris: to work with the rest of the world on a deal that restricts greenhouse gas emissions and be part of the solution, or behave as we just did at the OECD meeting, obstructing and degrading progress. Doing the latter is a recipe for social, moral and economic isolation, as we sit, arms folded, on the sidelines of one of the greatest industrial and economic transformations the world has seen.

“Prime Minister Turnbull said just a few weeks ago that we need to take the ideology out of the climate change debate. For Australia to take a modest proposal to prevent public money going into the most polluting coal power plants and only agree to it after kicking holes in it is a sign that we haven’t yet shaken off the ‘climate change is absolute crap’ ideology of Tony Abbott. We need to grow up fast.”

So to the many of you who signed our petition calling on Malcolm Turnbull to support the OECD deal, thank you for helping to get him most of the way there. The agreement is far from perfect, but does rule out public finance for the worst new coal power proposals, with the prospect of regular tightening of the restrictions over the coming years.

But the government’s reluctance to sign, and successful attempt to weaken the agreement means that we have a long way to go to end public finance for dirty fossil fuels.

To find out more about how our government is using public money to prop up fossil fuels, check out our recently updated fossil fuel subsidies page. You can also click here to read the Sydney Morning Herald’s coverage of the OECD deal.