Just last year, the European Commission’s executive vice-president Frans Timmerman emphatically stated that “fossil fuels have no viable future“.
At the climate talks later that year, six members of the Group of Seven (G7), namely Canada, France, Germany, Italy, the UK and the US, joined other countries in pledging to halt funding for new fossil fuels by the end of 2022. Japan was the only G7 member not to make this pledge.
Fast forward to mid-2022, and fossil fuel funding for oil and gas is now firmly back on the table, as is the continued and extended use of coal in some powerful countries like Germany.
Last week, G7 countries announced that Europe needed to scale back on its over-reliance on Russian energy. “In these exceptional circumstances, publicly supported investment in the gas sector can be appropriate as a temporary response to the current crisis,” the G7 Communique stated.
The impending energy crisis many countries worldwide are facing from the war in Ukraine has inevitably played a significant role in shifting positions. But it is also symptomatic of the EU’s own self-interest and fickle positioning. Germany, for example, has rejected the union’s ban on new fossil-fuel cars from 2035. The position Germany has taken on fossil-fuel vehicles – as one of the world’s leading automobile manufacturers – may not be surprising. Still, as one of the EU founding members and the bastion of green, it screams hypocrisy.
The fall and rise of gas
You’d be forgiven for feeling confused by the sudden change in direction, given the strong rhetoric about ending fossil fuel dependency that preceded the war.
For example, in November last year, France and Germany both signed declarations ending international funding for fossil fuels by the end of 2022, such was their commitment to their climate change objectives. In October last year, EU President Ursula von der Leyen said the move from fossil fuels to renewables must be sped up. Fast-forward a few months later, and gas is back in favour as Europe seeks to transition to clean energy – conveniently in time to suit the EU’s current objectives. What a difference a year makes! The world’s most powerful economies have now decided that Liquefied Natural Gas (LNG) has an important role to play in mitigating their dependence on Russian energy imports.
So what does this mean for climate commitments? Effectively, it shows that when it suits, those with the greatest responsibility to mitigate emissions (given their historical and continued contribution to climate change) are happy to shift the goal posts irrespective of the implications that this will have on our ability to meet the 1.5 degree target in the Paris Agreement. This is reminiscent of the oil crisis of the 1970s when the G7 committed to coal as an alternative to oil – making many countries reliant on coal and largely contributing to the current climate crisis we find ourselves in today.
The double standards Africa faces
If only they had asked Africa. Then they would have known that energy transitions aren’t that easy and that blanket pledges to eliminate all fossil fuels aren’t always immediately possible, as we and others have consistently pointed out.
While EU member states find solutions to their issues, perhaps the same “grace” can be extended to other countries. The blanket approach imposed by industrialised countries on developing nations doesn’t work. Instead, they should commit to seriously exploring solutions on a country-by-country basis to give the multinational climate agenda credibility.
As it stands, Africa is facing a threat to its food security. Still, nothing is being done to address how sanctions on Russia affect much-needed imports into the continent.
As Russia’s invasion of Ukraine began, sanctions were imposed on the former Soviet power to put pressure on Russia to end the war. These sanctions conveniently did not include Russian oil and gas, but they did prevent African countries from paying for imported cereals and fertilisers through the exclusion of Russian banks from international payment systems. Acknowledging the impact of such sanctions Olaf Scholz, the German chancellor, said there was a “glitch” in the sanction regime and acknowledged some difficulties with payments for fertilisers, but limited solutions were put on the table to date to address concerns by African countries.
But provisions have been made to allow certain EU countries to continue importing oil and gas from the country they are at war with. The result is that the EU contributed to Russia growing its average oil export prices to 60% higher than in May last year, according to Forbes. By May 2022, Russia’s export revenue had increased to €883 million a day.
The hypocrisy is galling. How will this affect Africa?
Implications for Africa
European countries are now scrambling to find alternative gas sources. This is where Africa comes in. African states, particularly in North and West Africa, are gas-rich, and some of these economies rely on LNG export revenues. Italy has already signed deals in Angola and Congo to ease its reliance on Russia’s gas imports, while Algeria, Niger and Nigeria have revived talks on a decades-old gas pipe project – a potential opportunity for Europe exports.
We are calling out the double standards that saw Africa punished for its reliance on gas. We urge these countries to exercise caution when accepting gas investments which may bring short-term benefits but will have long-term implications.
African exporters must be savvy and pay attention to the terms of the production-sharing contracts that will accompany these investments: if they factor in shorter cost recovery times by investing in multinationals, the countries may take a while to accrue benefits from the current boom in demand or, in the worst-case scenario, actually not benefit at all.
African countries must also ensure there’s enough gas for local consumption before trying to meet Europe’s needs. While Europe readies itself to cut off Russia completely, little is being done to assist African countries that are struggling with a worsening food crisis due to the Russia-Ukraine war and made worse by the EU’s sanctions on Russian banks.
The biggest concern, however, is how unreliable the European Union has proven itself to be regarding gas. How long will the interest in gas from Africa last, and what does this mean for Africa’s transition to new energy models when gas falls out of favour? When the tide changes again, Africa risks finding itself on the back foot when the industrialised world has further prepared itself for a transition that will ultimately penalise economies that rely on fossil fuels.
Perhaps this is the window of opportunity Africa needs to promote investments in its own clean infrastructure to increase its competitiveness globally, thus allowing African countries to set their local development ambitions rather than relying on Europe to set the agenda.
According to the World Bank, the total investment potential for clean energy in Africa is approximately $783 billion, based on existing national climate commitments in Côte d’Ivoire, Kenya, Nigeria and South Africa. Buildings and transportation account for about $652 billion, while renewable energy generation accounts for about $123 billion.
These clean energy investments can unlock significant economic opportunities for those countries. It’s a window of opportunity for African states to prepare for low-carbon futures and use their critical minerals to position themselves centrally in the green technology value chains and develop capabilities to address domestic needs while preparing for the future. This shows forward-thinking and preparing for where Africa is headed, not just finding solutions for where Africa is now.
How else can Africa ensure its low-carbon future plans aren’t derailed by the EU’s new gas objectives?