World Bank moves to limit funding for coal generation

The Bank has shifted away from coal power, and is trying to encourage developing nations to do the same.

The World Bank has announced a major repositioning of how it funds energy projects in developing nations, promising to massively scale back its support for coal-powered generation. In a paper out this week, the group confirms that it will provide financial support for greenfield coal power "only in rare circumstances." It continues:

Considerations such as meeting basic energy needs in countries with no feasible alternatives to coal and a lack of financing for coal power would define such rare cases.

At the same time, the bank will support interventions aimed at reducing the greenhouse gas emissions associated with coal plants, saying that:

Efficiency improvements at existing plants are among the most cost-effective means of reducing local and global environmental impacts of coal.

The topic of emissions in developing nations is a tricky one. On the one hand, many such countries see clean power as an unaffordable luxury, and resent the fact that the global north was able to develop using polluting industry and only then develop an environmental conscience. On the other, even though developed nations contribute a disproportionate chunk of global emissions, their per capita contributions are declining (or rather, increasing at a slower rate) and developing nations' just keep on climbing.

Against that background, an obvious first step is for international development programmes to stop actively helping developing nations develop polluting technologies instead of renewable ones. And when the World Bank makes a decision to change its focus, there's some heft to it: the group financed over $50bn worth of infrastructure projects last year.

That said, in practice, the change might not mean much. The Washington Post's Brad Plumer points out that it's already three years since the Bank's last big funding of a coal project, when it loaned $3bn to South Africa to build a plant near Johannesburg.

But the new president of the Bank, Jim Yong Kim, warns that there'll be at least one difficult choice quite soon. Plumer writes:

The one major test of the new policy will come in Kosovo,which wants to build a new 600-megawatt plant fired by lignite coal, a particularly carbon-intensive fuel. The bank needs to decide whether to offer loan guarantees, and Kim has signaled before that Kosovo may be an exception to the coal ban. “Climate change and the coal issue is one thing,” hesaid in April, “but the humanitarian issue is another, and we cannot turn our backs on the people of Kosovo who face freezing to death if we don’t move in.”

The move follows the Obama administration's plan to do the same thing. In June, the president said that he was "calling for an end to public financing for new coal plants overseas unless they deploy carbon-capture technologies, or there’s no other viable way for the poorest countries to generate electricity", which mainly affected the US Export-Import Bank, an institution which loans money to foreign nations looking to buy infrastructure from American companies.

All said and done, though, the fact that the biggest recent shifts against fossil-fuel generation are limits on foreign contribution is telling. When countries start changing their own behaviour – rather than just attempting to change other's – is when we'll know they are really serious about cutting emissions. And they need to be really serious really soon, because time is running out.

The World Bank. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Grant Shapps on the campaign trail. Photo: Getty
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Grant Shapps resigns over Tory youth wing bullying scandal

The minister, formerly party chairman, has resigned over allegations of bullying and blackmail made against a Tory activist. 

Grant Shapps, who was a key figure in the Tory general election campaign, has resigned following allegations about a bullying scandal among Conservative activists.

Shapps was formerly party chairman, but was demoted to international development minister after May. His formal statement is expected shortly.

The resignation follows lurid claims about bullying and blackmail among Tory activists. One, Mark Clarke, has been accused of putting pressure on a fellow activist who complained about his behaviour to withdraw the allegation. The complainant, Elliot Johnson, later killed himself.

The junior Treasury minister Robert Halfon also revealed that he had an affair with a young activist after being warned that Clarke planned to blackmail him over the relationship. Former Tory chair Sayeedi Warsi says that she was targeted by Clarke on Twitter, where he tried to portray her as an anti-semite. 

Shapps appointed Mark Clarke to run RoadTrip 2015, where young Tory activists toured key marginals on a bus before the general election. 

Today, the Guardian published an emotional interview with the parents of 21-year-old Elliot Johnson, the activist who killed himself, in which they called for Shapps to consider his position. Ray Johnson also spoke to BBC's Newsnight:


The Johnson family claimed that Shapps and co-chair Andrew Feldman had failed to act on complaints made against Clarke. Feldman says he did not hear of the bullying claims until August. 

Asked about the case at a conference in Malta, David Cameron pointedly refused to offer Shapps his full backing, saying a statement would be released. “I think it is important that on the tragic case that took place that the coroner’s inquiry is allowed to proceed properly," he added. “I feel deeply for his parents, It is an appalling loss to suffer and that is why it is so important there is a proper coroner’s inquiry. In terms of what the Conservative party should do, there should be and there is a proper inquiry that asks all the questions as people come forward. That will take place. It is a tragic loss of a talented young life and it is not something any parent should go through and I feel for them deeply.” 

Mark Clarke denies any wrongdoing.

Helen Lewis is deputy editor of the New Statesman. She has presented BBC Radio 4’s Week in Westminster and is a regular panellist on BBC1’s Sunday Politics.