On May 19, 2020, the Spanish Council of Ministers approved a Draft Bill on Climate Change and Energy Transition which sets out the country’s overarching climate policies. If the law is adopted, Spain will join a growing group of countries and financial institutions putting an end to oil and gas production. Research by OCI and others has clearly shown that a just and equitable decline of fossil fuel production is essential to meet the objectives of the Paris Agreement and stave off the worst effects of climate change:
- The oil, gas, and coal in existing extraction projects would take the world well above 1.5 degrees celsius (°C) and exhaust a 2°C carbon budget.
- Even if coal were phased out overnight, oil and gas in operating fields would exceed 1.5°C.
- According to UNEP’s 2019 Production Gap report, countries are planning to produce 120% more fossil fuels than would be consistent with limiting warming to 1.5°C.
While Spain is only a marginal producer of oil and gas, the importance of this decision goes beyond the volume of fossil fuels it will keep in the ground. Spain’s proposed licencing ban and divestment strategy puts it at the top of the pack of the growing number of countries and financial institutions ending their support to fossil fuel production. Following the example of Belize, Costa Rica, France and New Zealand, Spain’s supply-side measures are an important signal that climate leadership needs to be defined by a willingness to address the root causes of fossil fuel lock-in and to systematically work to disentangle economies from their dependence on fossil fuels.
Source: Price of Oil
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