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us export import bank
Biden Urged to Make Export-Import Bank Stop Fueling Climate Crisis
"If President Biden's climate commitments are to be taken seriously, his administration must take immediate, meaningful steps that stop EXIM from supporting polluting industries," said one campaigner.
Aug 07, 2024
Climate advocates on Wednesday formally urged the Biden administration to instruct the United States' export credit agency to stop financially supporting activities that are fueling the climate emergency.
"Over the last two centuries, human-caused greenhouse gas emissions have led to global warming of 1.1ºC above preindustrial levels by 2020 and caused detrimental changes in Earth's climate," Friends of the Earth (FOE) and the Global Law Alliance for Animals and the Environment wrote to U.S. Secretary of State Antony Blinken.
Stressing the threat that global heating poses to "our planet and its biodiversity" as well as "human rights, national security, and global financial stability," the pair warned that "greenhouse gas emissions must be cut in half by 2030 if warming is to be limited to 1.5ºC, the limit necessary to avoid the worst impacts of climate change."
Their letter calls on Blinken to "make a determination pursuant to the Chafee Amendment in the Charter of the U.S. Export-Import Bank... that EXIM should deny applications for financial support for all activities and projects whose life-cycle emissions intensity substantially contributes to greenhouse gas emissions and the climate crisis."
As the letter lays out:
EXIM is an independent federal agency that facilitates the export of U.S. goods and services in order to support the employment of American workers. EXIM provides loans, guarantees, insurance, and credit to American exporters, providing funding when "private sector lenders are unable or unwilling to" and helping to make U.S. exports competitive against foreign exports. In fiscal year 2023, EXIM approved more than $8.7 billion in direct loans, loan guarantees, and insurance. EXIM's total portfolio exposure as of September 2023 was more than $34 billion. Major industrial sectors supported by EXIM include oil & gas (24%), manufacturing (20.2%), and power projects (8.2%)—all of which are significant contributors to greenhouse gas emissions. In just a four-year period, from 2017 to 2021, EXIM financed $5.78 billion for fossil fuel projects alone. EXIM's financial support is backed by the full faith and credit of the U.S. government.
Erica Lyman, a law professor and director of the Global Law Alliance at Lewis & Clark Law School, explained in a statement that "administrations in the past have utilized the Chafee Amendment when national interests hang in the balance, and the catastrophic impacts of climate change are among the worst human rights, environmental, and national security challenges we face."
"The administration now has an important opportunity to continue to stand by its climate commitments to end federal funding for overseas fossil fuel projects," Lyman added.
Green groups including FOE have repeatedly sounded the alarm about EXIM's actions since President Joe Biden—who campaigned on various climate pledges—took office in 2021, including its October decision to fund the Liwathon oil tank project in Estonia and its March move to provide a $500 million loan for oil and gas expansion in Bahrain.
"Although President Biden has taken significant steps towards lowering greenhouse gas emissions, EXIM has refused to implement the president's commitment to end government support for fossil fuel projects abroad in nearly all circumstances," the letter states. "Instead, it continues to provide hundreds of millions—and sometimes billions—of dollars each year towards activities and projects whose life-cycle emissions intensity substantially contributes to high greenhouse gas emissions."
"EXIM's decision to continue providing this financial support undermines the administration’s commitments to reducing greenhouse gas emissions and fighting climate change," the letter argues. "The president should use the Chafee Amendment to force EXIM to stop its harmful financing decisions that run counter to U.S. national interests and policies."
FOE president Erich Pica emphasized that "a commitment from President Biden is meaningless without requisite action."
"This is where the rubber meets the road," he said. "If President Biden's climate commitments are to be taken seriously, his administration must take immediate, meaningful steps that stop EXIM from supporting polluting industries."
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Funding Poland LNG Project Would Break Another Biden Climate Promise, Warns Group
"If approved, this $500 million climate-wrecking handout would further threaten the air, land, and water of frontline communities in the United States and in Poland, making a mockery of Biden's purported commitment to environmental justice," said one campaigner.
Jun 01, 2023
Climate campaigners on Thursday said that within days, President Joe Biden's promises to end public finance for fossil fuel projects may prove empty if plans that the U.S. International Development Finance Corporation has indicated it has for an LNG project in Poland come to fruition.
The DFC, which oversees U.S. investments in development projects in lower- and middle-income countries, listed on its pending project list on May 23 a $500 million guarantee to support the Polish oil and gas company PKN Orlen to increase its liquefied natural gas (LNG) imports.
The pending transaction was listed ahead of the DFC's board meeting, which is scheduled for June 7.
Oil Change International (OCI) noted that the LNG listing was removed on May 30, but the "public information summary" remained live as of Thursday, suggesting the board could still approve the project.
The project, which would involve Wall Street firm Goldman Sachs helping the company to increase its imports, would be in direct contradiction to President Joe Biden's statement at the 26th United Nations Climate Change Conference in 2021 that his administration would end public finance for fossil fuel development after 2022.
"President Biden has cited his promise to end international public funding for fossil fuels as a sign of his ongoing commitment to climate leadership, even as he boosts fossil fuels and breaks many of his core climate promises at home," said Collin Rees, U.S. program manager at OCI. "The Development Finance Corporation approving this dirty project would show once and for all these claims are nothing but empty words."
"LNG is a false solution that will intensify the climate crisis and increase the world's dependence on fossil fuels."
LNG is gas that has been cooled and liquefied after being extracted by drilling or fracking. As Common Dreams reported in April, 116 climate action groups wrote to Biden ahead of the Group of 7 (G7) climate and energy meeting in Japan last month to warn that "the global LNG boom" must be stopped.
Campaigners say the continued expansion of LNG would harm communities that lie near fracking and drilling sites as well as LNG export terminals, while disregarding the warnings of scientists and energy experts who are unequivocal in their warnings that new fossil fuel extraction projects have no place on a pathway to keeping planetary heating under 2°C above preindustrial temperatures.
"If approved, this $500 million climate-wrecking handout would further threaten the air, land, and water of frontline communities in the United States and in Poland, making a mockery of Biden's purported commitment to environmental justice," said Rees. "A rapid buildout of 100% renewable energy is the only pathway to global energy security."
The DFC's potential approval of the project would mark the second time in less than a month that the Biden administration has agreed to finance new fossil fuel development. In May the U.S. Export-Import Bank approved nearly $100 million for the Balikpapan oil refinery in Indonesia.
U.S. Ambassador to Japan Rahm Emanuel also spoke at a recent Alaska Sustainable Energy Conference about a proposal for an 807-mile gas pipeline across Alaska and an LNG export terminal that he claimed would be in the United States' economic and national security interests.
"LNG is a false solution that will intensify the climate crisis and increase the world's dependence on fossil fuels," wrote Kay Brown, Arctic policy director for Pacific Environment, at Common Dreams on Thursday. "LNG is methane compressed and chilled to make it easier to transport. Methane emissions are 80 times more damaging to the climate than carbon dioxide, in the short term."
While Biden said at COP26 and at the G7 meeting that he is committed to ending public financing for fossil fuel projects past 2022, the White House has not released guidance outlining how that promise will be kept.
"Biden's refusal to publish public guidance upholding the international fossil fuel pledge is enabling DFC to keep funding dirty fossil fuel expansion," said Rees. "In removing this massive handout to the U.S. LNG industry from its pending project list, DFC is following Biden's lead and keeping ongoing fossil fuel support hidden from the public eye."
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