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EP Criticizes Fossil Fuels Investments in Uganda and Tanzania: Why such Resolutions Need Revisiting

spotlight 2022 17, 01.11.2022

Ahead of COP27, the EU, Uganda and Tanzania are divided over the East African Crude Oil Pipeline (EACOP). Following an EP resolution, relations are strained. In this Megatrends Afrika Spotlight, Emmanuel Rukundo (IDOS) argues that European climate debates need to reflect on the perspectives of low-income countries.

Between 2006 and 2009, Uganda discovered commercially viable oil reserves in the Albertine Region, the western part of the country. Since then, the country has embarked on developing a legal framework for oil governance, establishing management institutions, and investing in large-scale infrastructures to support the oil value chain, including an oil refinery to support local markets, an oil pipeline – the East African Crude Oil Pipeline (EACOP) linking Kabaale, Uganda, to Tanzania’s Chongoleani peninsula near Tanga port – to facilitate exports, highways, and an airport, among other things. Uganda has staked future earnings to the tune of US$ 24 billion to start or commit to these large-scale projects including three large hydropower dams.

But these investments seem to have come at the expense of non-ignorable costs – alleged human rights abuses and projected environmental effects that might increase Uganda’s carbon emissions by more than 10 times, from currently 4 million tons to projected emissions 17–34 million tons from fossil fuels alone. For these costs, the European Parliament, on 15 September 2022, adopted resolution 2022/2826(RSP). The main shareholder of the project is the French oil company TotalEnergies SE; the Chinese state-owned company China National Offshore Oil (CNOOC) and the two East African states own the remaining shares in the pipeline.

The resolution has sparked tensions between the EU and Uganda and Tanzania revealing “a faultline that could be further exposed at the COP27 climate change summit in Sharm el Sheik”. Policymakers from the two East African states criticized the resolution as hypocritical and neo-colonial and say the construction of the East African Crude Oil Pipeline (EACOP) will go on as planned.

Debating the resolution, some MEPs suggested not only a one-year moratorium for EACOP but a definitive closure of the whole project and instead more investments in renewable energy. Indeed, these policy goals for more renewable energy, human rights protection, as well as social and ecological protection are essential and should be supported. The conversation leading to resolutions such as these rests mainly on the strong environmental awareness that is emerging in the Global North, enabling the setting of policy prescriptions such as pledging to end public financial support for fossil fuels projects in low-income countries. Nonetheless, the blanket application of these resolutions and policies, however noble, can be deeply unfair, unjust, misguided, and could entrench more poverty rather than reduce it.

In this blog, I argue that climate debates, policies, and actions need to become more inclusive and lead poor countries to better-off and not worse-off positions. I argue from the dimension of the tension triangle framework, where relationships, preferences, and rights might pull in different directions. One example is managing preferences for progressive development policies (mainly low-income countries), energy security (both low-income and high-income countries), and climate change policies (with contextual causes across different geographies). With a focus on low-income countries, I provide three (of possibly several) reasons why the blanket application of these policies and resolutions needs revisiting.

Limited focus on climate fairness

Researchers and policy-makers from low-income countries have long highlighted the structural imbalance in climate change policies, underlining how unfair they can be to low-income countries. Climate fairness entails a) securing citizens’ basic needs, b) attributing historical responsibility to past emissions, and c) for highly emitting countries to meet their emissions reduction rates.

For instance, when considering previous and current emissions and the socio-economic development levels of Nigeria and Germany, fairness would entail that Nigeria and Germany do not have similar strategies for dealing with the climate crisis. An average German resident is responsible for about 13 times more emissions than an average Nigerian. The fairness principle can also be coupled with the right to develop. Fossil fuels have been essential for the development of high-income countries, and the same right should be afforded to low-income countries.

Respecting carbon budgets

Related to the issue of fairness is the necessity to contextualize the different carbon budgets available to each country. Data suggest that only about 20 countries account for more than 80 per cent of global emissions. Considering 2019 as the most recent Business-as-Usual scenario year, Africa as a whole emits only 4.5 per cent of global emissions, which is just about 57% of the EU-27 countries total (according to Our World in Data). Uganda and Tanzania currently emit about 4 and 11 million tons of C02, respectively. Including the projected annual emissions from EACOP and assuming an equal distribution to the two countries, an average German would still emit 16 times more than an average Ugandan.

Moreover, while the IPCC in 2018 warned that existing carbon budgets would run out by 2030, it also gave clear direction on responsibility. With a no action scenario, high-income countries have fewer years to run down their budgets than low-income countries that emit less. Uniform prescriptions for all countries – no matter their level of emissions and their carbon budgets – would be unfair to those countries emitting less.

The (environmental) cost of green energy

The debates leading to the resolution suggest that green energy needs to be prioritised over fossil fuels. Indeed, the aspirations to go 100 per cent renewable energy are noble, especially with the prospect of hydrogen production in several African countries. However, to some extent, green energy is not a panacea. Knowledge about the socio-ecological consequences and effects on land and marine ecosystems is thin. What is possibly underestimated with this aspiration are these contests, costs, and even paradoxes of such a drastic transition in their multiplicity.

Green energy and green technologies depend mainly on rare earth minerals such as lithium. However, their extraction is not necessarily emissions-free. As Aimee Boulanger, the Director of the Initiative for Responsible Mining Assurances, intimated, “Our new clean-energy demands could be creating greater harm, even though its intention is to do good.”

One avenue of rebalancing the debate on climate change is by integrating the framework of the tension triangle. The tension triangle calls for a balance between climate policies, energy policies, and development policies. A singular focus on one of the policies can be more harmful to the well-being of citizen of low-income countries. Understanding tensions between various demands, targets and preferences also invites low-income countries such as Uganda that no matter their low emissions, they cannot allow complacency to the threat of climate change. There is a need to understand and tackle the local drivers of climate change. For most of these countries, a major driver of climate change is land use change related to extreme level of deforestation, which is linked with poverty. Uganda alone loses about 120,000 hectares of forest annually, and not enough reforestation is being undertaken. This alone should be more worrisome than oil extraction. It implies that with increased forest loss, even small levels of emissions are not able to be captured and sequestrated. It is therefore paramount that every effort to develop by exploiting fossil fuels is outperformed by low-cost forest restoration, and at some point more efforts towards a renewable energy transition. In this way, even low-income countries can lower their net emissions without jeopardising social development.