The Dutch government today announced the elaboration of the COP26 decl

At the elaboration of the COP26 declaration, the cabinet coordinated with other signatories to ensure a level playing field as much as possible.

The intended government policy aims, in line with the declaration signed at COP26, to end new public support via export credit insurance (ekv) for the fossil energy sector abroad as of January 1, 2023. This concerns activities focused on exploration, extraction, processing, storage and transshipment, and transportation of fossil fuels, as well as electricity generation using fossil fuels. This elaboration of the COP26 declaration is an important step in further greening export credit insurance.

Seizing Opportunities in Energy Transition

Although the energy transition may be challenging for companies with many activities in the fossil sector, this development simultaneously offers opportunities for Dutch businesses. For example, companies can deploy their expertise for climate projects worldwide. Many investments in green projects will be needed for the energy transition in the coming period. The cabinet would like to take advantage of these opportunities and is committed to doing so. In recent times, many measures have already been implemented to better support green transactions with the ekv, such as insuring more risky green transactions and the green cover for investments in green innovations. With additional measures, the cabinet aims for further greening of export credit insurance. For example, the proactive establishment of credit lines for foreign buyers of Dutch products will begin, so that buyers can obtain an ekv-covered credit line for the purchase of goods and services in the Netherlands. In addition, there is an aim for 70% of assignments under the development cooperation infrastructure programs to be carried out by Dutch companies.

Strict Conditions for Exceptions

Due to the energy transition, certain investments in fossil infrastructure will remain necessary in the coming years to provide for our energy security. The ekv will therefore remain accessible under strict conditions for investments in existing fossil infrastructure in line with the 1.5-degree scenario. An important condition is that the economic life of the infrastructure is not extended. Other examples of exceptions are supporting services for fossil infrastructure, multipurpose ports, and electricity production in low-income countries with extreme energy poverty. Due to current geopolitical developments, the intended policy also provides space for projects that secure supply reliability in Europe and are in line with European REPowerEU policy.

Careful Implementation

Because many projects have a long lead time, the cabinet has chosen to work with a one-year transition period. For this, applications made before January 1, 2023, may result in a policy no later than December 31, 2023. With this, the Netherlands chooses careful implementation.

Since the signing of the COP26 declaration in Glasgow (2021), companies and NGOs have been involved in the elaboration. International coordination has taken place regarding the elaboration with co-signatories of the COP26 declaration. In this way, the cabinet wants to ensure the careful introduction of the new policy and a level playing field for companies. In the coming period, the cabinet will remain in consultation with other countries that have signed the COP26 declaration. The elaboration is therefore proposed policy that may still be revised should policy developments in other countries give cause to do so.