In an open letter, former president of Ireland Mary Robinson and ex-UN secretary-general Ban Ki-moon join 36 past world leaders in calling for “innovative solutions” to mobilise new climate and development finance.
A polluter profits tax “modestly applied” to the normal returns of oil, coal and gas companies worldwide – and significantly higher on windfall gains – could, they say, generate up to $400bn (£298bn) in its first year.
“During the oil and gas price crisis in 2022, many governments implemented windfall taxes. We must consider making such approaches permanent,” the letter states.
“Such measures would establish a clear incentive for companies to shift investment to renewable resources, while raising significant funds to address climate damages. These measures should also be complemented by fair taxation on the wealthiest individuals.”
The signatories highlight how the world invested more than $1.1trn in fossil fuels last year – much more than needed to meet climate goals – while the oil and gas sector spent only about 2.5% of capital on clean energy technologies, which was a 25% reduction from 2023 figures.
They say raising general taxation is "politically and socially difficult" at this time due to fiscal and cost-of-living pressures, but point to research indicating that eight in 10 people worldwide back taxing oil, gas and coal companies to fund climate damages.
“For too long, some of the greatest profits in the global economy have come from high emissions and environmental harm, with costs borne by the many, not the few,” said Ban Ki-moon.
“It is time to put in place permanent taxes on polluter profits so that industries whose emissions threaten all of us pay their fair share to fund the transition, protecting all people and particularly those already facing the most poverty and exclusion, and restoring trust in our shared future.”
This comes after research earlier this week from Climate Analytics revealed that governments plan to produce more than double the volume of fossil fuels in 2030 than would be consistent with limiting global warming to 1.5°C, and 77% more than would align with 2°C.
A previous assessment in 2023 found that the fossil fuel production gap was 110% above the 1.5°C warming pathway, but this has now risen to 120%, with governments planning even higher levels of coal production to 2035 and gas production to 2050. Planned oil production continues to increase to 2050.
Neil Grant, senior expert at Climate Analytics, said: “Ten years after Paris, renewables are way out in front of the pack. Instead of getting in the race, governments are blundering backwards towards our fossil past.
“While it’s frustrating seeing public money squandered on what will inevitably become stranded assets, it’s intolerably unjust to think about the human and environmental costs of these fossil expansion plans, especially for the most vulnerable.”
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Chris Seekings is the Deputy Editor of ISEP’s Transform magazine, which is published biomonthly for ISEP members. Chris’s role involves writing sustainability-related news, features and interviews, as well as helping to plan and manage the magazine’s other day-to-day activities.
