EBRD Energy Investments Do Right By the Planet

We have heard a lot of comment from anti-coal campaigners in the last several months, especially during the public consultation period for the new energy strategy. Their opinion is important to us, as are opinions of all stakeholders. But presenting the EBRD as the last institution that clings to coal and focuses on fossil fuels is incorrect on many levels.

We read this week's piece by WWF's Samantha J Smith with interest but the picture she painted is a far cry from what we have in fact been doing. The EBRD is the largest investor in energy efficiency and renewable energy in the region where we operate. We have financed some of the largest wind parks. We have invested over €2 billion into renewable energy directly and an additional €760 million through credit lines to local banks since 2006. By way of comparison, our total energy and natural resources portfolio since 2006 is €8.8 billion, of which only six per cent is coal-related.

Crucially, we have also worked with countries in the Western Balkans as well as other countries such as Kazakhstan and Ukraine to develop renewable energy legislation - thus enabling the development of a sustainable renewable energy industry. We made these investments possible in countries that traditionally rely on coal. For example, we financed the construction of the first wind farm in Mongolia - a country which sits on vast coal reserves. Currently we are considering the first wind farm in fossil-rich Kazakhstan. In Turkey alone, EBRD-financed renewable energy can light homes for 4 million people.

We have heard a lot of comment from anti-coal campaigners in the last several months, especially during the public consultation period for the new energy strategy. Their opinion is important to us, as are opinions of all stakeholders. But presenting the EBRD as the last institution that clings to coal and focuses on fossil fuels is incorrect on many levels. The piece gives the impression that coal is our main focus - that is wrong. It represents six per cent of our total investments in energy and natural resources; almost all of it is focused on improving the performance of existing plants, thus reducing emissions of CO2 and local pollutants.

The piece ignores the fact that most of our work with fossil fuels is centred on energy efficiency improvements, environmental clean-up, gas flaring reduction or helping economies switch from coal to gas. In addition to these investments, we finance not only renewables but also smart grids, smart meters and both supply and demand-side energy efficiency projects. Our investments in the energy and natural resources sector since 2006 have resulted in an annual reduction of CO2 emissions equal to the entire emissions of the Slovak Republic. The EBRD's sustainable energy investments have topped €12 billion in the same period.

Our draft energy strategy, which will be discussed by our Board of Directors on the 10th of December, clearly states that sustainable energy is and remains our goal. We will continue our strong support for renewables, energy efficiency projects, smart grids and meters. In addition, we will help countries switch from coal to gas where possible. In alignment with other IFIs, such as the World Bank, we will only finance coal-fired power generation in rare and exceptional circumstances.

Specifically we can see these circumstances in a country like Mongolia. The country needs to heat homes in the winter which renewable electricity cannot do, it has access to no other fuel, and it needs to replace old coal plants which are environmentally disastrous. It needs highly-efficient, modern combined heat and power plants built according to the best available standards.

We believe in sustainable energy. By that, we mean an energy sector that achieves global climate change goals, applies sound regulatory frameworks and provides a secure supply of energy to people and businesses at a price that is affordable. With every investment we make, in every one of our 34 countries, we work very hard to balance all these needs. The issue of coal has become a focus of a campaign by activists concerned with climate change - and I want to reiterate that we share those concerns. Just yesterday we arranged a loan for Russia's InterRAO for €280 million equivalent in roubles to move away from old coal-fired power plants in the Urals industrial heartland, by decommissioning them and switching to a much more efficient and environmentally friendly combined-cycle gas turbine.

Coal is only a part of the energy picture, which is diverse and fast-changing. We need to see this whole picture. We have been doing an important and difficult job of helping our countries, which inherited highly inefficient energy sectors, move to a more sustainable model. Our job is far from over. To get it done, all stakeholders - governments, businesses, civil society and the financial sector - need to work together.

Close

What's Hot