Bloomberg News

World Bank’s Kim Urged to Stop Financing Fossil-Fuel Projects

April 03, 2013

World Bank President Jim Yong Kim, who yesterday vowed to boost the lender’s contribution to easing the effects of climate change, was urged by non-profit organizations to stop financing fossil-fuel projects.

In a letter sent to Kim today, a group of more than 50 organizations, including Greenpeace and Friends of the Earth, welcomed his commitment to countering global warming and asked him to translate his pledge into action.

“The World Bank cannot meaningfully address climate change unless its lending practices, and core energy portfolio, do not further exacerbate the climate crisis and its impact on vulnerable communities,” according to the letter, which was posted on the website of one of the organizations, Washington- based Oil Change International. “It is by this measure, rather than words, that we judge the World Bank’s commitment to addressing climate change.”

Asked about the letter, World Bank Vice President for Sustainable Development Rachel Kyte said the bank has doubled its investments in renewable energy in the past five years. She said 19 percent of energy lending last year was related to fossil fuel.

“We will never end poverty if we don’t tackle climate change, but we have to make sure that poor countries have the energy they need to light schools, heat homes, keep medicines refrigerated and cook meals,” Kyte said in an e-mailed response. “Wherever possible, we do that through renewable sources.”

In the letter to Kim, the organizations said the bank should end support for all fossil-fuel projects unless it can be demonstrated that their sole purpose is to increase energy access to the poor and that there is no better alternative.

A 2011 draft energy proposal by the World Bank that considered limiting the lender’s financing of coal-fired plants to the poorest countries was never adopted. While the last large coal-fired plant financed by the bank was in South Africa in 2010, the lender is considering providing partial guarantee for a lignite-fired power plant in Kosovo.

To contact the reporter on this story: Sandrine Rastello in Washington at srastello@bloomberg.net

To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net


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