On July 16, 2013 the World Bank agreed to support universal access to reliable modern energy and limit the financing of coal-fired power plants to rare circumstances in an effort to address climate change concerns. As the Bank and other development agencies work to provide energy access to 1.2 billion people worldwide, this announcement signals an important shift toward clean, renewable energy sources. It follows President Obama’s announcement that the U.S. would not fund overseas coal projects in most cases.
Following is a statement by Jennifer Morgan, Director, Climate and Energy Program at the World Resources Institute:
“The World Resources Institute welcomes the World Bank’s focus on energy access and the decision to limit new coal investments to rare circumstances as a way of balancing development priorities with climate impacts. This is an important milestone and demonstrates President Jim Kim’s strong leadership in re-orienting the Bank’s portfolio toward low-carbon, climate-resilient energy that can help eradicate poverty and promote shared prosperity.
“With more than 1.2 billion people still lacking access to electricity globally, it is crucial that development banks and international institutions promote clean energy sources to end energy poverty. We know that the cost of inaction on climate change will take a disproportionately higher toll on the world’s poorest citizens and they deserve a clean energy future. With the falling price of renewable energy across the world, this vision of the future is no longer the high-cost option but the smart one. Using locally available renewable energy resources has proven effective in bringing sustainable, least-cost energy to those lacking access, while also opening new opportunities for local entrepreneurs.
“Although this is a critical step forward, we would like to see the World Bank go further. Evaluations of the economic, social and environmental impacts of all projects should take into account the full range of long-term risks and uncertainties, including the cost of greenhouse gas emissions, water availability and other impacts. In addition, the Bank should set itself ambitious goals on the amount of clean energy and energy efficiency financing it provides to demonstrate the viability of these investments.
“Coming on the heels of President Obama’s important announcement to limit U.S. investments in new coal-fired power plants overseas, our hope is that other multilateral development banks and international financial institutions will follow suit and hasten the shift to a clean energy future.”