Today, the Sierra Club and Oil Change International released a new report highlighting the failure of the world’s top multilateral development banks (MDBs) to align their energy lending with the International Energy Agency’s (IEA) projections for ending energy poverty.
On Monday, June 16 the Organization for Economic Cooperation and Development (OECD)’s Export Credit Group will meet to discuss climate and energy related financing through Export Credit Agencies – public agencies that fund or guarantee private corporations from their home country to invest or export overseas.
World Bank Group finance for projects that included fossil fuel exploration was highest in FY2013, at nearly $1 billion out of $2.7 billion total for fossil fuel projects in 2013.
In spite of a heightened institutional focus on combating climate change, the World Bank increased its lending for fossil fuels over the last year. Meanwhile, the World Bank also has a ways to go in terms of tackling its objective of supporting universal access to energy, as only 8 percent of the Bank’s energy portfolio last year targeted the world’s poorest.
The World Bank Group (WBG) increased financing for both fossil fuels and large hydropower significantly this past year, while financing for clean energy dropped. Overall, only 8 percent of the Bank’s energy financing last year was aimed specifically at the poor.
Two U.S. initiatives to provide Africans with electricity seem likely to lead to large, climate-polluting projects rather than the locally sourced renewable energy rural Africa needs.
Today, in the first major test of President Obama’s Climate Action Plan directive to end financing for overseas coal projects, the U.S. Export Import rejected the financing of U.S. exports to the 1200-megawatt Thai Binh Two coal-fired power plant in Vietnam.
Yesterday, the World Bank’s Executive Directors agreed to a new ‘Energy Sector Directions Paper’ which lays out the expected course for the Bank’s future energy lending. While there are some encouraging indications that the Bank will move away from coal financing, the increased emphasis on natural gas and large hydropower is likely to undermine the strategy’s stated objective of increasing energy access for the poor.
Development, faith, human rights, community, and environmental groups from more than 20 countries teamed up today to ask World Bank President Jim Kim to end Bank support for all fossil fuel projects unless the projects are solely focused on directly increasing energy access for the poor.