Published on August 7th, 2013 | by Anneli Hidalgo0
World Bank limits financing of coal-fired plants
On July 16, the World Bank’s board agreed to a new energy strategy that will limit financing of coal-fired power plants to “rare circumstances”.
The World Bank will thus amend its lending policies for new coal-fired power projects, restricting financial support to countries that have “no feasible alternatives” to coal, as it seeks to balance environmental efforts with the energy needs of poor countries. The last big coal fire power project funded by the World Bank was built in South Africa in 2010, a attracted lot of international criticism, particularly from the United States and Britain.
The decision was described by WWF as a welcome step towards a sustainable energy future, and “other finance institutions should immediately follow suit”. After the World Bank’s historic decision the European Investment Bank (EIB), the world’s largest public financial institution, soon took the same path. EU’s main lending arm, said it would stop financing most coal-fired power stations to help the 28-nation bloc reduce pollution and meet its climate targets. However, WWF has given a cautious welcome to the move by EIB. “The move by the EIB is very welcome but more needs to be done. To have a serious chance at staying within the 2°C climate change limit in Europe by 2050, the EIB should strengthen its standards and eventually phase out its support for all power supply based on fossil fuels.”