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A civil society response to the World Bank’s Investment Framework for Clean Energy and Development.

September 2006 - Friends of the Earth (FOI), Bretton Woods Project et al

Link to the full report

Extract from introduction 

In Gleneages, Scotland, G-8 leaders mandated the World Bank to create a new framework for clean energy and development, including investment and financing. In response to this mandate, the World Bank prepared a report on energy, climate change and poverty reduction for discussion at its Annual Meeting in Singapore in September 20061. Entitled “An Investment Framework for Clean Energy and Development: A Progress Report,” the document expands on a draft that was discussed at the Bank’s Spring Meeting in April 2006. The Bank’s most recent paper completes the first phase of the investment framework. A longer term program of country-level activities and global research is to be completed for the G-8 summit in Japan in 2008. The following report examines the World Bank’s investment framework and presents a response from international civil society groups.

For many decades, the World Bank’s energy lending has focused on centralized, large-scale, grid-based thermal and hydropower projects and on the privatization of public power utilities. This report shows that in spite of many promises to “green” its energy lending over the past 15 years, the World Bank’s energy sector portfolio still fails to reap the double dividend of renewable energy technologies that would fight both poverty and climate change. The Bank continues to invest $2 to $3 billion a year in greenhouse gas-producing energy projects, which fuel climate change and fail to help the world’s poor. Financing for renewable energy projects makes up less than 5 percent of the Bank’s overall energy financing in fiscal year 2005.

The Bank’s new framework will continue to sell the climate and poor people short. The April 2006 version of the clean energy investment framework is based on scenarios for global greenhouse gas emissions at levels that would allow “dangerous climate change” as defined by the Intergovernmental Panel on Climate Change. The framework also promotes additional funding for energy technologies that have negative social and environmental impacts, and that will in many cases further contribute to climate change. The framework does not catalyze the necessary massive shift to renewable energy technologies that could create the double dividend of environmental benefits and poverty reduction. The framework’s “business as usual” approach will not adequately address climate change, and will continue to keep more than one billion poor people in the dark.

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