The new policy will allow Italy’s export credit agency SACE to support various fossil fuel projects, including exploration, production, storage, and distribution. Climate experts have strongly criticised the move, saying it would breach international commitments and slow down the country’s green transition.
A new policy for phasing out public financial support for fossil fuel projects overseas has raised concerns among environmentalists about potential backsliding on Italy’s COP26 pledge to cut investments by 2022.
The new rules, presented by Premier Giorgia Meloni last week, will allow Italy’s state-owned export credit agency SACE to finance gas exploration and production projects until January 2026. Existing exemptions, which include projects deemed “strategic” for the nation’s energy and economic security, could postpone the date even further. Support for oil transport, storage, and refining projects will be allowed until 2024, and oil distribution until 2028. A deadline for gas transport and storage has yet to be defined.
At COP26 in 2021, Italy joined 38 countries in signing the Glasgow Statement, a joint pledge on “International Public Support for the Clean Energy Transition” to end any support for fossil fuel projects abroad by the end of 2022 and in its place prioritise finance for clean energy.
At last year’s UN climate summit, COP27, Meloni vowed to remain “strongly committed to pursuing [the country’s] decarbonization pathway, in full compliance with the goals of the Paris Agreement” despite a “very complex scenario” brought about by the Covid19 pandemic and gas shortages amid Russia’s invasion of Ukraine. Indeed, last year’s European energy crisis slowed down not just Italy’s but the whole bloc’s green transition, forcing several governments to extend funding plans for gas infrastructure and secure deals abroad to cut their reliance on Russian gas.
In 2021, Russia accounted for 40% of Italy’s total gas imports. Last year, the number dropped by more than 60% and in 2021, the weight of Russian gas dropped to just about 8%, while imports from Algeria and Azerbaijan increased.
Meloni defended the “pragmatic approach” the country is taking, arguing that “the road to a green economy must be socially and economically sustainable.” However, climate experts accused the government of breaking international pledges, insisting that the country should have focussed on scaling up renewables and improving energy efficiency instead.
Non-profit campaign group Oil Change International called Meloni’s policy “the worst among countries that signed the 2021 commitment.” For climate think-tank Ecco’s co-founder Luca Bergamaschi, the new rules set “a terrible precedent for other countries.”
Besides backsliding on climate pledges, Italy has been pushing back on several policies of the European Union’s ambitious green deal, calling on the bloc to water down a directive aimed at improving the energy efficiency of buildings and re-write plans to phase out combustion engine cars.
The calls come as most regions across the country battle with the dramatic consequences of a changing climate.
In February, authorities warned of a potential new drought after last summer’s extreme heatwave dried up the country’s longest river, with dramatic repercussions on the local agriculture and hydroelectric supplies. After the historic heatwave, an exceptionally warm and dry winter has raised concerns among scientists and environmental groups about a new, nationwide drought emergency.
Many of the country’s rivers and lakes – especially in northern regions – are already suffering from a severe water shortage. Water levels on Lake Garda, Italy’s largest lake, have reached record lows, while River Po, the country’s longest and most important river, currently has 61% less water than normal this time of year.
In a statement released in February, environmental group Legambiente urged the government to develop “a national water strategy that has a circular approach with short-, medium- and long-term interventions that favour adaptation to climate change and the reduction of water withdrawals and waste immediately.”
Featured image by Wikimedia Commons.