According to a report released on Thursday, the World Bank has invested $14.8 billion worldwide in projects related to fossil fuels since the landmark Paris climate accord.
According to a report that was compiled by a coalition of non-governmental organizations known as The Big Shift Global, the multilateral lender made a promise in 2018 to stop financing upstream oil and gas. Although direct funding had decreased, the move did not include indirect financing.
It comes in the wake of growing pressure on US President Joe Biden to fire World Bank Chief David Malpass, a Trump appointee who has shied away from answering questions about whether or not climate change is caused by humans.
Big Shift's Sophie Richmond stated, "Each time the World Bank invests in another fossil fuel project, it fuels more climate disaster."Using taxpayer funds to exacerbate the climate crisis is not justifiable.
According to the report, one of the primary methods by which the Bank continued to finance fossil fuels was by taking advantage of a "major loophole" by lending to intermediaries like banks or financial institutions and acting as a guarantor in the event that a nation did not fulfill its obligations.
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As part of the 2015 Paris Agreement, world leaders agreed to limit long-term warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) to prevent disastrous effects on the planet's ability to sustain life in the future.
The report's largest project, titled "Investing in Climate Disaster:The Trans-Anatolian Pipeline in Azerbaijan was funded in 2018 with $1.1 billion from World Bank Finance for Fossil Fuels, with the Bank serving as a guarantor.
The report stated, "It serves to perpetuate on-going use of fossil gas in Europe," noting that, despite the pipeline's potential to boost gas export revenues, market volatility renders it unreliable.
The project was “expected to have potentially significant adverse social and environmental impacts that are diverse, irreversible, or unprecedented,” according to the World Bank Group's own assessment, but it was nonetheless approved.
Coal plants
Despite the fact that the electricity supply to the Java and Bali grid is already oversupplied by 40%, the Bank provided $65 million in indirect funds for the construction of two coal plants in Indonesia known as Java 9 and 10.
According to Yuyun Indradi of Trend Asia, a non-governmental organization that advocates for clean energy, "It is obvious that the new Java 9 and 10 coal-fired power plants will bring more disaster in terms of environmental, social, and health issues, in an area already covered with coal plants and industries."
The authors of the report also said that the Bank's treatment of natural gas as a "bridge" between renewable energy and fossil fuels left out investments in clean energy that were needed.
The World Bank stated in a statement to AFP, "We dispute the findings of the report:It makes false assumptions regarding the lending practices of the World Bank Group.
“In fiscal year 2022, the Bank Group delivered a record $31.7 billion for climate-related investments, to help communities around the world respond to the climate crisis, and build a safer and cleaner future.”
The World Bank "supplies very little evidence to support its claims about the amount of climate finance it provides," according to a separate Oxfam report earlier this week, requiring the public to "take their figures on faith."