The COVID-19 crisis has caused more disruption to the global energy system than any other event in recent history according to the International Energy Agency, leaving countries and communities most dependent on fossil fuels further vulnerable to demand and price shocks. This adds to the threat of stranded assets beyond the fossil fuels era, as the adoption of climate policies and access to cost competitive renewable energy continues to grow.
Despite the risks and continued global economic uncertainty, governments around the world have invested significant amounts in fossil fuels as part of COVID-19 recovery. G20 nations for example, are choosing to direct more stimulus funds to oil, gas and coal than renewable energy sources. This is despite the fact that wealthier countries often have more flexibility to transition their economies towards emerging and sustainable industries than most countries in the Global South, many of which depend on fossil fuel revenue for development finance and which face significant economic development needs and energy access issues.
Part of the challenge is that currently, the risks are not being added up. There is no single, comprehensive, publicly accessible and government verified database of existing, planned and potential fossil fuel production. This leaves countries, investors and civil society with limited options for assessing the climate and financial risks of future fossil fuel investments or to account for different actors’ contributions to the problem. This holds back efforts to plan for and coordinate a more diversified, sustainable and prosperous future where no country, community or worker is left behind.
Having a tool to increase transparency of and accountability for the consequences of fossil fuel development is particularly crucial, as the United Nations Environment Programme estimates countries have fossil fuel projects planned at a level that would result in 120% more emissions by 2030 than what is in keeping with limiting warming to 1.5C. And the question of fossil fuel production phase-out represents an existential challenge to many states, with the Carbon Tracker Initiative identifying 19 states with over 400 million people that are ‘highly vulnerable’ to the transition from oil and gas given the dependence of state revenues on fossil fuel production.
That’s why our organisations, Climate Action Network South Asia and Power Shift Africa, are part of a coalition of partners that called for a Global Registry of Fossil Fuels. Throughout 2021 work on the Registry has taken off, led by Carbon Tracker and Global Energy Monitor. The Registry will enable country governments to track and report information on fossil fuel reserves, along with historic and planned future fossil fuel production, and expressed in terms of the carbon dioxide embedded within each project and extraction site. The goal is to encourage governments to engage with the Registry and report their own data, and in turn improve domestic transparency measures on fossil fuels, including compelling corporations to report information to bring it into the public sphere for the first time. As a result, the Global Registry of Fossil Fuels would be the most accurate, comprehensive and up to date source of information on fossil fuel reserves and production. It will also offer significant normative value as the first international transparency mechanism on fossil fuels, with governments accountable for reporting and updating their data.
The data included in the Registry will reveal the climate consequences of each oil, gas and coal project so that governments can begin to make course corrections in equitably phasing down production before it is too late. It will also highlight the vast potential for stranded assets – those projects that will become financially unviable before the end of their planned lifetimes, as a result of reduced demand for coal, oil and gas both due to climate policies and to decreasing cost competitiveness compared to renewable energy, electric vehicles and other alternatives. It would help determine countries’ contribution to emissions and responsibility for their fair share of the solution.
A prototype of the Global Registry was presented by Carbon Tracker and Global Energy Monitor during COP26 on November 11, 2021. The prototype provides an immediate source of data for researchers and policy-makers and highlights gaps in existing information. Interested stakeholders are invited to access the Registry and provide their feedback, in advance of the formal launch of the completed Registry in early 2022.
Transparency and accountability in the energy transition are critical if we are to meet development and energy needs while ensuring climate security and health. It is also a vital first step in mapping a fair and equitable energy transition for those countries and communities that currently rely on fossil fuels for revenue and employment. A Global Registry of Fossil Fuels can act as a starting point and create a foundation to foster a multilateral agreement around phasing out of fossil fuels – including a pathway to an eventual Fossil Fuel Non-Proliferation Treaty – and moving to clean, low-carbon alternatives.