FOR IMMEDIATE RELEASE
December 3, 2018
Alex Doukas, alex [at] priceofoil.org
Gareth Russell, gareth [at] jerseyroad.co.uk
Jon Sward, jsward [at] brettonwoodsproject.org
Nezir Sinani, nezir [at] bic-europe.org
Kat Kramer, kkramer [at] christian-aid.org
Big Shift Global reaction to World Bank Group’s post-2020 climate goals announcement
On December 3, the World Bank Group released a new set of climate targets for 2021 to 2025, through which it aims to provide and mobilize USD 200 billion in support of countries’ climate action over this period. According to the Bank’s press release, it will provide USD 133 billion in direct finance, and leverage USD 67 billion in private sector investment as part of the USD 200 billion target. In response, the Big Shift Global coalition released the following statement:
In putting substantial resources towards finance for climate action, the World Bank Group is signaling to the wider world that developing countries should receive far more support to both reduce their emissions and address the devastating impacts of climate change that threaten them, including increasingly extreme weather, sea level rise, and decreased food production.
While the World Bank Group’s latest signal of commitment to climate action is encouraging, this new statement is silent on the desperate need to radically scale up financing for distributed renewable energy, especially to bring modern electricity to the poorest of the world’s people, to support the global community’s aim of achieving universal energy access by 2030 — a core element of the Sustainable Development Goals.
And the new statement is also silent on the World Bank Group’s remaining fossil fuel finance, which, if it persists, will continue to undermine efforts to fight climate change. A new approach to engaging with the financial institution partners of the World Bank Group’s private sector arm, the IFC, was announced in 2018, to limit coal finance — but this statement does not help clarify whether that approach will apply not only to coal, but also to oil and gas, despite the World Bank Group’s commitment to phase out their direct financing for upstream oil and gas activity last year.
Alex Doukas, Program Director with Oil Change International, said:
“The World Bank Group has promised to do more to help vulnerable countries fight climate change, and that should be applauded. But unless the Bank does more to reduce its direct and indirect support to the fossil fuel industry, its finance will continue to work at cross purposes and damage the climate. The Bank’s private sector arm, the International Finance Corporation, should clarify that its new proposed limits to indirect support for the coal industry will also apply to the heavily polluting oil and gas industry.”
Ben Niblett, Senior Campaigner with Tearfund said:
“The World Bank Group has stepped up its climate commitments and provided a boost to the urgently needed finance for the most vulnerable to adapt to devastating floods, storms and droughts. But millions of people are still living in the dark without clean, affordable energy. To avoid people being left behind and to boost economic growth, the World Bank must significantly scale up investments in off-grid renewable energy, like solar.”
Jon Sward, with the Bretton Woods Project, said:
“The Bank’s new commitments fall short of ensuring that its investment portfolio is in line with a 1.5ºC future. Civil society groups had called for the Bank to introduce an emissions target for its lending and operations as part of its post-2020 climate goals, but the new set of targets do not introduce any new restrictions on the Bank’s fossil fuel finance. Moreover, one-third of the Bank’s $200 billion climate finance commitment will come from leveraging the private sector. There’s a question of how relevant this approach is for low-income countries (LICs), where grant and loan-based finance will be needed to fund these countries’ climate transitions.”
Nezir Sinani, with Bank Information Center Europe, said:
“This increase in climate finance is meaningful only if the bank ends its support to coal and other fossil fuel investments. The World Bank Group continues to be exposed to coal and other fossil fuel investments due to weak policies and safeguards that apply to its indirect lending instruments, i.e. World Bank’s Development Policy Loans (DPL) and IFC’s Financial Intermediary (FI) investments. In order to avoid such exposure, the World Bank Group needs to introduce a climate safeguards that applies to its DPL investments, must disclose its exposure to coal and other fossil fuel projects in its IFC FI investments and end its collaboration with FI clients exposed to coal.”
Dr. Kat Kramer, with Christian Aid, said:
“While the World Bank’s additional finance can help to drive very low carbon and climate-resilient development, overall, today’s statement provides little sense of its anticipated overall climate impact. At its annual meeting in October, the Big Shift Global coalition had called upon the Bank to commit to transforming its entire investment portfolio to be consistent with limiting global warming to 1.5ºC above preindustrial levels, essential to avoid life-and death climate impacts, that affect the poorest the most. The world needs the Bank to repudiate the fossil era, and embrace the efficient and renewable enlightenment, as the only acceptable paradigm for energy investments.”
Notes to Editors:
- As part of its post-2020 climate commitments, the World Bank also launched an Adaptation and Resilience Action Plan, which seeks to provide USD 50 billion in direct adaptation finance over 2021 to 2025, and to create a new ranking system to ‘track global progress on adaptation and resilience.’
- The WBG will also support countries to implement their Nationally Determined Contributions to the Paris Agreement, and develop long-term strategies to climate change: ‘Together with the NDC Partnership, the WBG will support at least 20 countries to systematically implement and update their NDCs and support an increasing number of countries to develop integrated mid-century low carbon and climate resilient strategies.’
- The targets also seek to elevate climate action in key sectors, by ‘enabling infrastructure for 36 GW of renewable energy, and supporting 1.5 million GWh-equivalent of energy savings through efficiency improvement; in cities, helping 100 cities achieve low-carbon and resilient urban planning and transit-oriented development; and in food and land use, increasing integrated landscape management in up to 50 countries, covering up to 120 million hectares of forests.’
- The Big Shift Global coalition is a multi-stakeholder, global campaign coordinated by over 40 organisations from the Global North and South. Together, we aim to make the people’s views on energy finance known to Multilateral Development Banks (MDBs), their Executive Directors, as well as the Heads of State and Finance Ministers of the members countries. Leveraging public opinion is crucial to aligning decisions made by the MDBs with long-term climate safety and poverty goals – this inevitably involves a shift away from financing any form of fossil fuels to financing clean, sustainable, renewable energy for all.
- On September 26 2018, the World Bank Group announced a new USD 1 billion program to support the deployment of battery storage for electricity in developing countries, with the aim of leveraging USD 4 billion in additional resources to support this agenda.