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People’s movements and civil society dismayed at AIIB Energy Sector Strategy

JEJU, SOUTH KOREA. Grassroots movements, non-government organizations and civil society networks across Asia and the rest of the world expressed “strong disappointment and disagreement” today to the Energy Sector Strategy of the Asian Infrastructure Investment Bank (AIIB), which is holding its 2nd Annual Board of Governors Meeting in Jeju, South Korea.

The groups met at the Benikea Hotel in Jeju from June 13 to 15 to agree on their analysis of the AIIB Energy Sector Strategy paper. They are attending as official delegates from CSOs and NGOs to the AIIB Board of Governors meeting.

Disappointed for still allowing coal financing

Lidy Nacpil, coordinator of the Asian Peoples’ Movement on Debt and Development (APMDD) said, “We welcome the fact that we were invited to submit our proposals and concerns during the process of drafting the bank’s Energy Sector Strategy. But we are disappointed to and disagree with the Energy Sector Strategy paper for still allowing coal financing. While it qualifies the conditions under which coal projects can be financed by the AIIB, the circumstances described still leaves the door wide open for coal support”.

“The deeply harmful impacts of coal mining and coal power plans on communities and the environment are undeniable and well-documented.  Coal power’s huge contribution to the escalation of the climate crisis is well-established and widely acknowledged.  It is in direct contradiction to AIIB’s avowed commitment to sustainable development and the Paris Agreement which expresses a goal of keeping temperature rise below 1.5 degrees,” Rayyan Hassan of the NGO Forum on ADB clarified.

Clean coal is unacceptable

Sreedhar Ramamurthi, managing trustee of India’s Environics Trust expounded, “The problem of energy poverty still affects hundreds of millions of people in the region. Governments have used this as justification to expand the coal power industry – referring to coal as the quickest and cheapest solution to the problem of energy access.  This is not an acceptable argument. Neither is it acceptable to present “clean coal technologies” as the alternative to old and obsolete coal technologies.  There is no longer any excuse not to directly shift to renewable energy systems, which have already become more economically and financially feasible alternatives as evidenced by experiences in many countries including China and India”.

Wawa Wang, public finance officer of Bankwatch cited that last month, the costs for solar in India hit another record low, at US$37/MWh. It dropped by an astonishing 45% since January 2016 its last recorded lowest price. Proposals for new coal-fired power plants are now being abandoned as they could no longer compete with solar prices.

“Likewise, we disagree with AIIB supporting large hydro systems such as Nenskra hydropower in Georgia, which is in the Bank’s pipeline to be decided upon on September. For decades communities in Asia have resisted these projects for their devastating social and environmental impacts,” Wang furthered.

Green Bank for Swift and Just Transition from Dirty Energy

Antonio Tricarico of Re:Common, formerly with the Campaign to Reform the World Bank (CRBM) concluded, “The AIIB, if it is to be true to its claims as a “green bank,” must marshal its resources to support a swift and just transition to renewable and clean energy systems for people and communities of Asia, and put an end to fossil fuels and other harmful energy as soon as possible.  Our people and planet deserve no less.”

For interviews, contact:

Lidy Nacpil (lnacpil@gmail.com)

Sreedhar Ramamurthi (environics@gmail.com)

Antonio Tricarico (atricarico@recommon.org)

Rayyan Hassan (rayyan@forum-adb.org)

Wawa Wang (wawa.wang@bankwatch.org)

Planned coal power in the Balkans will breach new EU pollution standards – analysis

Almost none of the new coal power plants planned in the Western Balkans will meet new, stricter EU pollution standards, according to a new analysis by CEE Bankwatch Network, released today.

The analysis is available at https://bankwatch.org/sites/default/files/BREF-Balkan-coal-14Jun2017.pdf

On 28 April this year, EU officials adopted new technical standards for large combustion plants, the so-called ‘LCP BREF’, (1) which sets out the best available techniques for controlling pollution to air, water and soil, as well as the emission limits that must be achieved by applying these techniques.

Bankwatch’s analysis (2) looks at eight coal-fired units totalling 2.6 GW in capacity planned in Bosnia-Herzegovina, Kosovo, Macedonia, Montenegro, and Serbia, (3) plus the Stanari plant in Bosnia-Herzegovina which started commercial operation last September. Compared to the air pollution limits set in the BREF, five of the planned units would certainly not meet the new standards, while insufficient information is available for the remaining three.

Non-compliance is a problem not only for countries seeking EU accession – as these countries would be required to adopt EU law – but also for compliance with domestic legislation. Most governments in the Western Balkans have already adopted legislation stating that the EU’s LCP BREF is to be used as the basis for permitting new coal projects, so these standards must be applied to new plants as soon as they enter force in the EU later this year.

“Of course project promoters will be reluctant to cause delays to their projects by undertaking reviews and taking measures to bring them into line with the new LCP BREF, but failing to do so now will cost them dearly later. The additional costs that the new standards would entail are but the latest warning sign for governments that coal is fast becoming an unbearable liability”, said Pippa Gallop, Bankwatch’s research co-ordinator and author of the briefing.

“Now that electricity companies in the Western Balkans are obliged to adhere to EU market rules, they must do much more to make sure their investments are financially viable and future-proof,” added Ioana Ciuta, Bankwatch Energy Co-ordinator. “They can no longer just go and ask the state for money for additional funds for investment or push legal implementation deadlines ever-further into the future. They need to start looking ahead and examining whether their plans are going to land them in trouble in a few years”.

Contacts

Pippa Gallop
Research Co-ordinator, CEE Bankwatch Network
pippa.gallop@bankwatch.org
+385 99 755 9787
Skype: pippa.gallop

Ioana Ciuta
Energy Co-ordinator, CEE Bankwatch Network
ioana.ciuta@bankwatch.org
+40 724 020 281
Twitter: @unaltuser

Notes

(1) For the decision and the annex containing the standards, see http://ec.europa.eu/transparency/regcomitology/index.cfm?do=search.documentdetail&Dos_ID=14177&DS_ID=50159&Version=1

(2) The analysis is available at https://bankwatch.org/sites/default/files/BREF-Balkan-coal-14Jun2017.pdf

(3) The planned plants are:

Bosnia-Herzegovina: Tuzla 7, Banovići, Ugljevik III units 1 and 2
Kosovo: Kosova e Re
Macedonia: Oslomej reconstruction
Montenegro: Pljevlja II
Serbia: Kostolac B3

More plants are planned across the region but are at a less advanced stage of preparation.

The Runcurel expropriations, Europe’s second most harmful subsidy

The Romanian Government has been named and shamed today in a public fossil fuel subsidies awards ceremony in Brussels. From 10 April till 8 May, the public voted on the deadliest, dirtiest and sneakiest subsidies to fossil fuels in Europe. Our country was shamed for fostering land expropriations required for expanding a coal mine, displacing families and destroying nature.

In today’s award ceremony, Romania came in second in the Deadly Funding Award category. Declaring the project one of “public utility and national interest”, EUR 3 million were allocated from the state budget through Government Decision 960/2015 to buy 341 hectares of land and immediately hand them over to Oltenia Energy Complex. Owners will therefore receive a mere 1 EUR per square metre, regardless of what they own – be it forests, orchards or houses. 113 hectares of forest, two historical monuments and an entire village will be wiped out from the map. This year, the Government plans to publish two similar decisions for the expansion of the Jilț Sud and Roșia mines.

European countries have all agreed to scale up their efforts to tackle climate change in compliance with the Paris Climate Agreement. Still, governments and other public institutions all over Europe are spending billions of euro on funding one of the main causes of climate change: the extraction and burning of fossil fuels. By providing subsidies, governments end up taking one step forward and two steps back when it comes to climate action.

Alexandru Mustață, Bankwatch Romania energy campaigner said: “We are hoping that this award will make the Romanian Government reconsider spending another 2.5 million euro for two more mine expansions. Enough people have already suffered from the Runcurel expropriations.”

CAN Europe’s Director Wendel Trio explained: “These awards reveal that financial commitments are not consistent with Government promises to tackle climate change in line with the Paris Agreement. With the awards we expose a large amount of largely hidden subsidies for fossil fuels and call on all European Governments to phase them out urgently and no later than 2020. We also ask them to make their budgets 100% climate-friendly and implement the clean energy transition as soon as possible. They must put their people and environment ahead of polluting fossil fuels.”

How Europe’s bank spends cash for climate undermines Paris commitments

The EU’s 28 finance ministers will be meeting tomorrow (May 23) to discuss the priorities of the European Investment Bank (EIB) for the coming year. A new analysis finds the bank’s contribution to Europe’s response to the climate crisis has been worryingly insufficient and needs to be stepped up.

An uneven investment strategy across the EU’s 28 Member States and a lack of added value by one of its main financial tools means that the EIB puts the EU at risk of not meeting its climate targets under the Paris Agreement, according to a new briefing from Counter Balance and CEE Bankwatch Network.

The full briefing is available here on the Bankwatch website.

The EIB’s “climate action” lending has increased last year to a total of EUR 17.5 billion. But, as the briefing shows, in as many as 12 Member States less than 10 per cent of EIB loans support projects intended to reduce greenhouse gas emissions and facilitate adaptation to the impacts of climate change.

Most of these are ‘cohesion countries’, where GDP is lower than the EU average, hence the greater need for climate action money. Nevertheless, the briefing finds that EIB money for climate action is overwhelmingly allocated to the more advanced economies of the EU.

The briefing also shows how the European Fund for Strategic Investment (EFSI), the guarantee mechanism rolled out by Commission President Juncker to attract private capital, failed to reach the 25 per cent climate action threshold set by the EIB, with just EUR 2.5 billion in 2016 allocated to projects that contribute to climate change mitigation and adaptation.

This again bodes poorly for the ‘cohesion countries’, where EFSI climate finance did not exceed 10 per cent of total loans to the region. Conversely, 70 per cent of the money for renewable energy projects went to a single country – Belgium – while 80 per cent of money for energy efficiency was earmarked for France, Finland and Germany.

Anna Roggenbuck, EIB policy officer at CEE Bankwatch Network, said: “Clearly the EIB needs to do better with its climate money, especially for those who need it most. In addition to more for renewables and energy efficiency, the bank needs to move away from the fossil fuel investments that undermine its progress on climate action elsewhere, like the massive EUR 3 billion loans proposed for sections of the Southern Gas Corridor.”

Xavier Sol, Director of Counter Balance, said: “For all the fanfare pumped by the Commission about the EFSI, it has not lived up to its billing so far, especially in terms of contributing to European cohesion. The geographical concentration of the funds remains problematic for the second consecutive year, despite it being repeatedly pointed out by both civil society and the European Parliament. This is certainly an issue that European finance ministers need to address, also in the context of Brexit and its uncertain consequences on the EIB.”

For more information contact:

Xavier Sol
Director, Counter Balance
xavier.sol AT counter-balance.org
+32 2 893 08 61
Twitter: @xavier_sol

Anna Roggenbuck
EIB Policy Officer, CEE Bankwatch Network
annar AT bankwatch.org
+355 683 281 550 (only available until May 24)

 

Image by Steintec

Investment Plan for Europe more climate friendly, but European Parliament shows little ambition

Today in Strasburg, the European Parliament lead committees have brought the European Fund for Strategic Investments (EFSI) closer to compliance with the Paris Climate Agreement. However, they have once again fallen short of eliminating fossil fuel subsidies, which stand in the way of climate action.

Today the ECON/BUDG committees (1) voted on the European Parliament’s position on the future of the EFSI, the cornerstone of the Investment Plan for Europe. The committees have endorsed a 40% target on climate action. They also empowered the EFSI steering board, a governance body led by the European Commission and the European Investment Bank overseeing the strategic direction of the fund, to develop a climate test which all eligible projects and the overall EFSI portfolio have to pass.

In a previous vote on the prolongation of the EFSI in the ITRE committee MEPs agreed to even higher climate protection targets and the introduction of earmarking for energy efficiency. Those more ambitious climate action elements though have not been picked-up by the ECON and BUDG committees.

Overall, this position of the European Parliament does not go much further than what the European Commission and Council proposed earlier.

In September 2016 the European Commission published its proposal for the prolongation of the EFSI until 2020 – two and a half years beyond its initial term – with the aim to leverage 500 billion euro in additional investments across the EU. The Commission’s proposal offered some positive climate action provisions, such as setting a 40% target for projects with climate relevance or providing for technical assistance to beneficiaries to develop clean energy projects, though it still allows for financing of fossil fuel infrastructure (2).

In December 2016 the ECOFIN council supported the positive climate protection provisions of the Commission’s proposal. However, they still did not exclude financing for fossil fuel infrastructure from the EFSI.

Markus Trilling, Finance and Subsidies Policy Coordinator at Climate Action Network (CAN) Europe said:
“By introducing a climate proofing tool for the entire EFSI the European Parliament finally acknowledges the obligations stemming from the Paris Climate Agreement, namely to shift financial flows and investments in order limit climate change to 1.5C.”

“However, the European Parliament missed out on the most straightforward way to achieve compliance with the climate protection requirements, namely to ban fossil fuels. Now it is on the Steering Board to develop and, even more important, to enforce climate impact assessment tools which guarantee the EFSI is fit for future and contributes to catalyse the low-carbon and clean energy transition.”

Xavier Sol, Director at Counter Balance said:
“Reinforcing climate action as part of the Investment Plan for Europe is a welcome step. Indeed, EFSI has been supporting numerous fossil fuel infrastructure, namely gas projects, as well as high-carbon transport infrastructure. Therefore, we hope the changes brought forward by the Parliament will contribute to reverse this trend and force the EIB to rule out such investments.”

Anna Roggenbuck, Policy Officer at CEE Bankwatch Network said:
“Endorsing a 40% target on climate action was awaited and necessary step given the EFSI disappointing climate action record in 2016. Perhaps this will finally give the Fund a boost to direct financial guarantees towards this type of investments. We hope that this will also be an incentive for financing renewables and energy efficiency projects in countries where so far EFSI has not been utilised.”

 

For more information, contact:

Nicolas Derobert, CAN Europe Communications coordinator, nicolas@caneurope.org, 00 32 483 62 18 88

Xavier Sold, Counter Balance director, xavier.sol@counter-balance.org, 00 32 473 223 893

 

Notes for the editors

(1) http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&reference=CJ16-OJ-20170515-1&language=EN

(2) “The Steering Board shall provide detailed guidance and assessment tools, in particular with regard to eligible projects and to the overall portfolio of the EFSI, with particular regard to COP21. That guidance shall ensure that at least 40 % of EFSI financing under the infrastructure and innovation window supports project components that contribute to climate action”

Italian authorities overrun communities in a bid to enable Europe’s dash for gas

In a last minute attempt to force facts on the ground, the Italian authorities have enabled the removal of a group of olive trees to make room for a future construction site of the Trans-Adriatic Pipeline (TAP), despite an earlier agreement between the company and local institutions. Nevertheless, the company has not been able to clear the site by the official deadline and the residents have vowed to step up their protest against the largest energy project the EU is currently pursuing.

The 3500 kilometers long Southern Gas Corridor (SGC) is intended to bring to Europe 10 billion cubic meters of gas per year from Azerbaijan via Georgia, Turkey, Greece, Albania, and Italy. TAP, the western leg of the SGC, is planned to reach the shores of southern Italy, near the town of Melendugno.

Yet, local communities on Italy’s southern coast fear the massive pipeline and its accompanying infrastructure could have irreversible impacts on the peaceful Apulia region whose economy is dependent on tourism and agriculture.

In late March the company, TAP Ag, started works intended to uproot over 200 olive trees to make room for the construction of the western end of the pipeline. This move was met with fierce but peaceful popular resistance, and in late April, after a series of meetings with the mayor of Melendugno and the local prefect, the company decided to suspend the works ahead of the official deadline of April 30th, until the end of the 2017 tourist season.

Still, in the last week of April the company’s excavators unexpectedly arrived at the site late at night, after police had breached the protest barricades, blocked nearby roads and rounded up local activists. Although 11 more trees were removed, the company will not be able to commence construction as 16 other ancient olive trees, which have a legal protection as natural monuments, remain at the site.

The local residents have repeatedly stressed that their concerns extend well beyond the local olive grove. They have campaigned against the TAP pipeline since nearly five years, as they perceive it as an imposed mega-project, bound to impact people and the environment in Europe and beyond. Feeling betrayed by their own state, a few Melendugno residents have started a hunger strike demanding the government to engage in an open dialogue on its support to the project.

But the people in Melendugno are not alone in opposing this pipeline. Farmers and land owners in Greece have also been protesting the pipeline project on very similar grounds, and residents in more than 30 communities across Albania, whose livelihoods depend on agriculture, have been raising similar concerns about the removal of vineyards, plum trees and olive groves for the construction of the TAP pipeline.

In parallel, the project has raised serious concerns in terms of transparency. Already contested for its dodgy links to the Azeri regime, the pipeline was recently the subject of an extensive investigation conducted by the Italian magazine L’Espresso. Shedding light on TAP and TANAP (the Trans-Anatolian Pipeline) and the network of state-owned companies with links to Vladimir Putin, Recep Tayip Erdogan and Ilham Aliyev as well as Russian oligarchs involved in the projects, the investigation reinforces earlier concerns that the project was designed to serve the interests of a few, at  citizens’ expense.

Gianluca Maggiore, spokesperson of the No TAP Committee, says: “The local residents have made it clear we will not allow this destructive project to go ahead. Our opposition has gained broad support across the country and beyond, proving this project is simply not feasible. There are still numerous outstanding technical issues around the next phases of the works and their compliance with the requirements of the environmental impact assessment. However, we don’t oppose the TAP project just to defend our lands. Designed to fill the pockets of three authoritarian regimes with dismal human rights record – in Azerbaijan, Russia and Turkey – this project prioritises geopolitical games over the actual needs of people and the environment.”

Elena Gerebizza, campaigner with the Italian NGO Re:Common , says: “The Italian government and the European Commission should acknowledge the reasons behind the peaceful resistance to TAP in Italy for years now, and review the political and financial support to the project. TAP is not bringing any benefits to Italian and EU citizens, who are rather asked to bear the costs of this mega-project”.

Xavier Sol, from the European civil society coalition Counter Balance, says: “The situation on the ground looks very far from the rosy picture described by the promoters of the project. It is high time for the European Commission to stop supporting this project which is faced with local resistance, is not in line with the EU’s climate commitments under the Paris Agreement and supports oppressive regimes.”

For more information contact:

Gianluca Maggiore, local NO TAP committee spokesperson
+39 339 684 7706

Elena Gerebizza, Energy Campaigner Re:Common
egerebizza@recommon.org
+39 340 670 53 19

Xavier Sol, Director Counter Balance
xavier.sol@counter-balance.org
+32 2 893 08 61