Progress report on clean energy investment

One of the major background reports for this year's meetings was "An Investment Framework For Clean Energy And Development: A Progress Report", which had been commissioned in response to a mandate from the G-8 summit in Gleneagles in 2005 (see Bridges Trade BioRes, 8 July 2005). The report focuses on steps to achieve environmentally sustainable electricity development, particularly in Africa, to transition to a lower-carbon economy and to adapt to climate change. It concludes that the financing gap for the energy for development and energy access agendas should be met through energy sector policy reform and to attract the private sector, as well as through public sector funding. It calls for a global regulatory framework that would support the transition to a low-carbon economy. It also stresses the need for enhanced adaptation strategies in order to achieve progress in fighting poverty.

Meeting on 18 September, the joint IMF-World Bank Development Committee in its communiqué welcomed progress made under the clean energy investment framework and asked the Bank to work with other international organisations to explore financing options to support investment in clean energy for development and to maximise the use of existing instruments.

NGOs critical of Bank energy efforts

A number of environment and development NGOs, including Friends of the Earth International, the Institute for Policy Studies and Oil Change International, said, however, that the Investment Framework on Clean Energy and Development will neither be effective at combating climate change nor for expanding energy access for the poor. The organisations criticised the framework for raising USD10 billion for conventional energy that have lower greenhouse gas emissions.

"In continuing to lend for fossil fuel and dam projects, the World Bank has consistently missed the social and environmental double dividend that renewable energy technologies could bring," said Peter Bosshard of International Rivers Network. Graham Saul of Oil Change International stressed that "if the World Bank wants to be a positive force in the fight against climate change then the first step is to stop subsidising the expansion of the oil industry."

The NGOs instead recommended an approach based on ending subsidies for fossil fuel projects, increasing efforts to meet the basic energy needs of the poor, and redirecting existing energy financing to renewable technologies and energy efficiency projects via a new Renewable Energy for Development Agency.

ICTSD reporting; "World Bank's Clean Energy Plan Sells Climate and Poor People Short," FOE, 17 September 2006.