No end in sight for EBRD coal finance

Istanbul – With the 2013 EBRD annual meetings underway and in spite of repeated commitments to sustainability, the bank is set to continue financing coal projects that will dangerously aggravate climate change.

The EBRD is currently reviewing its energy sector lending policy, a process which takes place only once every five to six years, with a first draft of the policy expected during the summer. Under the current EBRD policy, nearly half of EBRD energy investments went to fossil fuel projects, with its lending for coal increasing from 60 million to 262 million euros (2006-2011).*

In March 2013 the EBRD provided 100 million euros to a new 600 MW lignite plant at Sostanj in Slovenia and is set to finance new coal operations in both Kosovo and Serbia, where it has already financed coal mining operations at the Kolubara complex.

“With repeated warnings about the need to end public subsidies for fossil fuels, pouring millions of euros into coal is unacceptable for a public institution like the EBRD,” said Fidanka McGrath, CEE Bankwatch Network EBRD coordinator. “At a time of scarce public finance, the EBRD must lead rather than follow markets.”

Some examples of EBRD coal projects:

• Belchatow II in Poland, which received 125 million euros from the EBRD, will emit 5.5 million tonnes of CO2 per year for the next 40 years.
• The Sostanj 6 lignite plant in Slovenia, which received 100 million euros from the EBRD, will make it nearly impossible for Slovenia to meet its 2050 EU emissions reduction targets.
• The Turceni lignite plant in Romania should have stopped operations in 2015 as per EU legislation, but the EBRD contributed 150 million euros to modernise the plant, enabling it to emit CO2 for another 15 years.
• The EBRD is considering a loan of 400 million euros for the 750 MW Kolubara B lignite plant in Serbia, and it has also recently expressed interest in financing a new 600 MW lignite plant near Pristina, Kosovo.

Notes for the editors:

1. Read more about the EBRD energy review process:
http://www.ebrd.com/pages/sector/powerenergy/comment.shtml

2. Read a critical take on the EBRD’s energy lending authored by Bankwatch, one of the main NGOs monitoring the bank:
https://bankwatch.org/publications/comments-ebrds-2006-energy-operations-policy-and-recommendations-forthcoming-energy-str

3. Read more about European public financing for fossil fuels:
https://bankwatch.org/sites/default/files/briefing-EnergyLending-22Apr2013.pdf

* EBRD 2012 energy lending figures are released during the annual meetings.