U.N. Secretary-General Antonio Guterres on Oct. 12 urged development banks to stop backing fossil fuel projects, after a report found the World Bank had invested $12 billion in the sector since the 2015 Paris Agreement to combat climate change.
Environmental campaigners have for years tried to persuade commercial banks to stop lending the oil, coal and natural gas industry money citing climate change.
But the world's state-backed development banks, whose support is often crucial in determining whether projects in developing countries go ahead, are also facing growing calls to starve the industry of finance.
Guterres urged a coalition of finance ministers and economic policymakers from dozens of countries to ensure development banks end fossil fuel investments and boost renewable energy.
"We need speed, scale, and decisive leadership," Guterres said in a video message to a virtual meeting of the group.
Earlier on Oct. 12, a report by Berlin-based environmental group Urgewald said that the World Bank had invested more than $12 billion in fossil fuels since the Paris accord, $10.5 billion of which was direct finance for new projects.
That put the World Bank far ahead of other development banks in supporting the sector, said Heike Mainhardt, a senior adviser to Urgewald, who wrote the report.
With the world already on track to produce far more fossil fuels than would be compatible with temperature goals agreed in Paris, the report questioned why the World Bank would back increased oil and natural gas production in countries such as Mexico, Brazil and Mozambique.
The World Bank said the report gave a "distorted and unsubstantiated view," adding that it had committed nearly $9.4 billion to finance renewable energy and energy efficiency in developing countries from 2015-19.
The bank also said the report ignored its mandate to help around 789 million people living without electricity, mostly in rural Africa and Asia.
Mainhardt said the bank's support for fossil fuels was hindering a transition to cleaner energy needed to achieve the Paris accord's goal of avoiding catastrophic climate change.
"It's so misleading for them to act like they are a champion of the climate when they really are such a huge part of the problem," Mainhardt told Reuters. "Because the World Bank keeps giving billions in public assistance, that distorts the market for fossil fuels, it slows down the energy transition."
Recommended Reading
Tech Trends: Safety, Speed, Savings: Automation is Transforming Drilling
2024-03-26 - Drilling is getting smarter through automation, delivering efficiency, consistency and reliability.
AI Advancing Underwater, Reducing Human Risk
2024-03-25 - Experts at CERAWeek by S&P Global detail the changes AI has made in the subsea robotics space while reducing the amount of human effort and safety hazards offshore.
CERAWeek: Large Language Models Fuel Industry-wide Productivity
2024-03-21 - AI experts promote the generative advantage of using AI to handle busywork while people focus on innovations.
Geothermal ‘Could Save the World,’ but Faces Familiar Subsurface Risks
2024-03-20 - CERAWeek panelists discussed hurdles to widespread use of Earth’s heat to generate power — problems familiar to oil and gas operators.
CERAWeek: AI, Energy Industry Meet at Scary but Exciting Crossroads
2024-03-19 - From optimizing assets to enabling interoperability, digital technology works best through collaboration.