Governments in North America and Europe are spending billions of taxpayer dollars on ineffective, unproven technologies, such as carbon capture and fossil hydrogen, according to a new report from research and advocacy group Oil Change International.
The report, published this week, revealed that USD 30 billion in public money has gone towards carbon capture and fossil hydrogen to date.
Titled “Funding Failure,” the group’s paper spotlights the US (USD 12 billion), Norway (USD 6 billion), Canada (USD 3.8 billion), the EU (USD 3.6 billion) and the Netherlands (USD 2.6 billion) as the worst offenders, accounting for 95 per cent of this spending.
The US, specifically, was found to have spent USD 4 billion subsidising carbon capture for enhanced oil recovery (EOR) with public money. Globally, governments have spent USD 4.2 billion on projects that plan to produce hydrogen from fossil fuels using carbon capture.
However, the report notes that much more has been committed in policy announcements.
Oil Change International calls carbon capture a “dangerous distraction” promoted by fossil fuel companies and government enablers to prolong the use of fossil fuels, outlining that these subsidies will facilitate continued fossil fuel extraction and enhance the industry’s profits—which are already sky-high.
Interestingly, Exxon is noted to have shifted from a “carbon capture skeptic” to a “vocal supporter” following successful lobbying efforts to secure billions in subsidies.
“Governments are pouring billions of taxpayer dollars into technologies that have consistently failed to deliver on their promises,” said Lorne Stockman, Research Director at Oil Change International.
Stockman warned that these projects not only fail to deliver results, but also delay the necessary transition to renewable energy by “propping up “the fossil fuel industry.”
The current capacity for global carbon capture projects operating today is just over 0.1 per cent of annual global emissions, but the report notes that the actual amount of emissions captured is “likely much lower.”
Its primary use remains enhanced oil recovery, whereby captured carbon is injected underground to extract more oil.
“Carbon capture allows fossil fuel companies to continue business as usual when it’s high time for them to be phased out. Governments must redirect their support towards proven, effective solutions to the climate crisis,” added Stockman.
The report calls for governments to remove subsidies, introduce and expand policies that make polluters pay, and apply public resources, including funds from removing CCS subsidies, to true climate finance.
“Governments must fulfill their global climate finance commitments and support a new, ambitious cross-cutting climate finance goal, with rich countries paying their fair share on fair terms to avoid worsening the most widespread debt crisis in history,” Oil Change International said this week, adding that prioritising public finance for communities most in need and key infrastructure for a just energy transition is essential.
