European development bank decides to keep cooking the planet

The EBRD’s new Energy Sector Strategy, guiding the Bank’s energy financing until 2028, introduces new criteria intended to restrict financial support to midstream and downstream fossil gas projects that are deemed ‘exceptional cases.’ Yet, this new policy fails to put an end to the EBRD’s decades of sinking billions of public money into fossil fuels.  

In addition, the strategy adopted by the board leaves the door open to financing of fossil gas projects via financial intermediaries such as commercial banks in some cases. 

With this decision, the EBRD – owned by 72 governments – has effectively turned a blind eye to both the scientific community repeatedly warning humanity must end its fossil fuel addiction — not expand it [1] — and growing public pressure on the EBRD to divest from fossil gas and instead step up its support for a just, sustainable energy transition.  

During public consultations on the Energy Sector Strategy, members of the public sent over 6200 emails to the EBRD, demanding that the EBRD fully excludes financing of fossil fuels [2]. A similar request was voiced in a letter to the Bank signed by Bankwatch and over 130 civil society groups from more than 40 countries. [3] 

The EBRD is currently considering backing for several fossil gas projects – among others, in North Macedonia, Uzbekistan and Bosnia and Herzegovina – which, if materialised, are only likely to entrench countries’ dependence on polluting and expensive fossil gas. This misguided approach to public funds, at the expense of much needed investments in energy efficiency and renewable energy sources, would only hamper the energy transition across the EBRD’s countries of operation. 

Over the past two weeks, at the COP-28 climate summit, more than a hundred governments, including EU member states, have been calling for a halt to fossil fuel subsidies. And yet, representatives of many of these very governments on the EBRD’s board of directors voted to keep channelling public money to fossil gas projects. 

Gligor Radečić, Gas Campaign Leader with CEE Bankwatch Network, says: ‘This is a missed opportunity for the EBRD to stop adding fossil fuel to the climate fire and show its countries of operation how the energy transition looks. The responsibility now lies with the Bank’s shareholders, represented by the board of directors, to assert their right to oppose all fossil gas project proposals in the upcoming strategy period. 

There is a pressing need for increased scrutiny and introspection within international financial institutions. If they are genuinely committed to aligning financial flows with the Paris Agreement goals and preventing the worst impacts of climate change, they must lead from the front. In practice, that means no more public funds for fossil fuels.’ 

Lisa Rose, Associate Director with 350 Europe, says: ‘The EBRD is being disingenuous with its vaunted new energy strategy that it says will help tackle the climate crisis. The reality is that the Bank has deliberately left loopholes to continue investing in gas under ‘exceptional cases’. This mirrors what we see happening time and time again, including at the UN Climate Talks in Dubai. Many governments and financial institutions claim to be aligned with the Paris Agreement but then they do all they can to avoid committing to the level of action we need. The EBRD can’t support the Paris Agreement and invest in fossil energy at the same time. Climate justice activists around the world are demanding an end to all fossil fuel investments and the powering up of renewable energy for all.’ 

Notes to editors: 

[1] Paris alignment: why there is no more space for European public money to finance fossil fuels: https://bankwatch.org/wp-content/uploads/2023/12/2023_12_Paris-alignment_why-there-is-no-more-space-for-European-public-money-to-finance-fossil-fuels.pdf

[2] Thousands demand European development bank stops financing fossil fuels https://bankwatch.org/press_release/thousands-demand-european-development-bank-stops-financing-fossil-fuels 

[3] The Energy Sector Strategy 2024-2028 Must Mark the End of the EBRD’s Support to Fossil Fuels https://bankwatch.org/publication/the-energy-sector-strategy-2024-2028-must-mark-the-end-of-the-ebrd-s-support-to-fossil-fuels 

For additional information, please contact: 

Gligor Radečić
Gas Campaign Lead, CEE Bankwatch Network
gligor.radecic@bankwatch.org
+385977454467 

Mark Raven
Europe Communications Manager, 350 Europe
mark@350.org
europe-comms@350.org
+44 784 147 4125
England, United Kingdom