We're doing it: The European Commission is going all out to distance itself from Russian oil and gas, and will uncover €195 billion in financing to shore up alternatives as soon as possible | Photo: prothomalo.com

European Commission earmarks €195 billion to wean itself off of Russian fossil fuels

The European Commission will unveil draft measures next week that will earmark €195 billion in investments to wean its members off of Russian fossil fuel imports. The measures will be a mix of non-binding arrangements, EU laws and recommendations to national governments, and the bloc may also use resources from its enormous Covid-19 recovery fund to spearhead the transition. 

The response comes as a protest against Russia’s military offensive against Ukraine and the specific goals include the EU targeting a 45% share for renewables by 2030 (instead of the current 40%), the production of 10 million tonnes of renewable hydrogen by 2030 and importing an additional 10 million tonnes, jumpstarting large-scale solar energy projects and opting for a 13% EU-wide reduction in energy consumption by 2030 (instead of the current target of 9%). Most importantly, the EU is reportedly considering loosening the administrative procedures needed to set up large-scale solar and wind projects, such as the requirement to comply with environmental impact assessment studies. 

India to re-open closed coal mines, eases rules for coal mining to battle heatwave 

The Indian government approved the re-opening of 100, previously-shuttered coal mines, in a bid to boost the fuel’s supply to its reeling power plants, and the government also invoked section 11 of the Electricity Act, under which the country’s import-based coal plants must generate power at full capacity. The measures come as India reels under a severe heatwave and with projections for power demand shooting up to as high as 200GW. The coal mines to be re-opened were shuttered as they were considered to be financially unviable, and the country’s power minister has reiterated that the fuel will play a major role in India’s energy mix going forward. 

The state governments have also been ordered to import the fuel for the next three years, and the country’s green rules will be eased for those mines that were already approved to boost their output by 40%. This would enable them to expand their output by another 50%, and the changes to the rules will stay in effect for the next six months. 

USA: California lays out plan to go carbon-neutral by 2045, slash fossil fuel use 

The California Air Resources Board (CARB) laid out a plan to drastically cut the state’s reliance on fossil fuels, and stated that it would have to switch to fully-electric stoves, furnaces and other appliances from 2026. The plan is in its draft stages but it aims for the state to achieve carbon-neutrality by 2045, which would be the fastest for any US state. However, while the plan was criticised by the Western States Petroleum Association for “more bans, mandates and expensive regulation”, it was also lambasted by environmentalists for suggesting an expansion in the use of natural gas, and for keeping room for carbon capture technologies. 

Bond market a back door to obtain financing for fossil fuel projects, China supports more coal  

Several civil society organisations, including the Sunrise Project and Urgewald, stated that the international bond market was still being used to finance major fossil fuel projects, and that it was a back door to as much as $491 billion in financing for companies like Chevron, ExxonMobil and Saudi Aramco. The activists said that the coal market was the most reliable on bonds and as major banks pulled away from the fuel, the bonds had generated 2.5 times more capital than bank loans. The mechanism is so effective that it was the primary source of raising capital in India and China, and the coal companies had together raised $12billion in 2022 already, vs. $5billion in all of 2021. 

Also, the Chinese central bank approved an additional funding of $15.13billion (100bn yuan) to increase its “targeted re-lending quota” for the “clean and efficient utilisation of coal”. The increase was approved by the State Council and takes the government support for the fuel up to $45.4billion (300bn yuan), which the Chinese media claims is Beijing’s step towards boosting national energy security.