An inquiry into the scale and impact of UK Export Finance’s (UKEF) investment in fossil fuel projects in low and middle-income countries has been launched.
It will also explore alternatives to fossil fuel investment and subsidies and the government’s plans to respond to growing energy use in middle-income countries.
UKEF is the nation’s export credit agency – part of the Department for International Development – and aims to ensure “no viable UK export fails for lack of finance or insurance”, providing guarantees, insurance and reinsurance against loss.
The Agency is estimated to have provided £551 million per year in support of fossil fuel production overseas between 2014 and 2016 and fossil fuels made up 99.4% of all energy support provided between 2010 and 2014.
EAC Chair Mary Creagh MP said: “Almost all of UK Export Finance’s energy projects support fossil fuels overseas. This flies in the face of government’s commitment to cut greenhouse gases and locks developing countries into high-carbon energy production. We need joined-up thinking across government to make sure that overseas financial support does not fly in face of UK Government’s environmental commitments.
“Our inquiry will explore the impacts and alternatives to UK Export Finance’s support of fossil fuels. I encourage anyone with any insight into this area to submit evidence.”
The Committee is inviting submissions until 4th January 2019.
UKEF said the nation’s priority, at home and abroad, is to encourage international opportunities for UK businesses , “ensuring they can build fruitful relationships with overseas partners”.
A spokesperson added: “UKEF is committed to high standards of environmental, social and human rights risk management and rigorously follow the requirements of the OECD Common Approaches and Equator Principles, which set the framework for export credit agencies and international financial institutions in this area.
“We look forward to working with the Environmental Audit Committee on its inquiry and will review its findings as we continue to develop our support for UK exports.”