09 April 2010

More on the World Bank South Africa Coal Plant Decision

According to Reuters, the US, UK and the Netherlands all abstained from lending their support for the new power plant. Hand any of these countries explicitly opposed the decision, it would not have gone forward. So an abstention in the context of no other opposition works out as a "yes" vote in practice. Reuters notes:

The opposition to the Eskom loan has raised eyebrows among observers who note that Britain and the United States are allowing development of coal-powered plants in their own countries even as they raise concerns about those in poorer countries.

The South African plant is using the same so-called clean coal technology used in the United States and other developing countries to lower carbon emissions.

The Environmental Defense Fund called the bank's decision a setback.

"This was a missed opportunity for the U.S. and the World Bank to move away from a traditional focus on fossil-fueled growth and toward a new model of low-carbon economic development," said Peter Goldmark, director of the Environmental Defense Fund's climate and air program.
In contrast the Center for American Progress, a US NGO calling fro strong action on climate change, celebrated the tough stand taken by the United States:
It is further encouraging that the U.S. vote is consistent with the Treasury Department’s recently released guidelines for multilateral development banks’ financial support of coal-fired power plants
In contrast to this strange spin, the Obama Administration saw the decision as being contrary top their own guidelines, according to Reuters:

The U.S. Treasury said the project was inconsistent with U.S. guidelines issued in December by the Obama administration on coal-related lending by development banks.

It said the project was also incompatible with the World Bank's strategy to help countries pursue economic growth and poverty reduction in ways that are environmentally friendly.

Mix together development, poverty, economics, energy access and what you'll get is a whole lot of contortions and inconsistencies on climate policy.

Any guesses as to what happens when the next big coal plant comes before the World Bank? The answer should be obvious.