Equity, climate justice and fossil fuel extraction: principles for a managed phase out

Equity issues have long been debated within international climate politics, focused on fairly distributing reductions in territorial emissions and fossil fuel consumption. There is a growing recognition among scholars and policymakers that curbing fossil fuel supply (as well as demand) can be a valuable part of the climate policy toolbox; this raises the question of where and how the tool should be applied.

This paper explores how to equitably manage the social dimensions of a rapid transition away from fossil fuel extraction. Fossil fuel extraction leads to benefits for some people (such as extraction workers) and harms for others (such as pollution-affected communities). A transition must respect and uphold the rights of both groups, while also staying within climate limits, as climate impacts will fall most heavily on the world’s poor.

This paper begins by reviewing how extraction affects economies and communities and the different transitional challenges they face. Based on that review, it then examines three common equity approaches — economic efficiency, meeting development needs, and effort-sharing. Drawing lessons from the strengths and weaknesses of these approaches, the paper proposes five principles as a basis for equitably curbing fossil fuel extraction within climate limits:

1. Phase down global extraction at a pace consistent with limiting warming to 1.5°C;
2. Enable a just transition for workers and communities;
3. Curb extraction consistent with environmental justice;
4. Reduce extraction fastest where doing so will have the least social costs;
5. Share transition costs fairly, according to ability to bear those costs.

Key policy insights:

• Fossil fuel extraction is unlikely to be a viable path to development because the Paris Agreement goals require most fossil fuel use to be ended within a generation;
• Extraction should be phased out fastest in diversified, wealthier economies that can better absorb the transitional impacts;
• Governments of extracting countries should enact ambitious industrial policy to diversify their economies, alongside economic and employment policies to enable a just transition;
• The costs of a just transition should be borne by those most able to bear it: poorer countries can reasonably demand financial support.