This initiative asks G20 governments to include a timeframe for phasing out such subsidies, which will put into action the commitments made in the climate change conference, also known as COP21, in December 2015.
Nico Aspinall, chair of the IFoA’s Resource and Environment Board, said: “This Statement asks the G20 to actually implement its long-standing commitment to phase out fossil fuel subsidies and to set a timeframe for this of 2020.
“Without these subsidies, there would be a more level playing field for the investment in renewable energy sources we desperately need to avoid the worst consequences of climate change in the future.”
The IFoA claims fossil fuel subsidies act as “a barrier to investment in renewables” on the scale needed to deliver greenhouse gas reduction commitments made at COP21.
It considers climate risk to be “one of the greatest risks facing current and future generations”, adding: “We believe that the greatest chance of having a meaningful impact to managing climate risk is if we work together as a global community to address the continuing emissions of greenhouse gases.”
Aspinall said this commitment would send “a clear message” to businesses and investors that dependence on fossil fuels needs to diminish.
“They should start diversifying energy sources and investing in energy security, which will help us to take positive action towards mitigating climate change risk,” he said.
“For this initiative to be successful, as well as a commitment to transparency and publically available annual reporting, the G20 should also commit to implementing means for ratifying these reports.”