Off-Grid Clean Energy Demands Social Bankability

A while back I wrote about the need for social bankability based on the casual observation that our financial and energy systems are broken. Social bankability, simply put, is the decision, by fiat, to use public funds to fill in gaps where private banking has failed, but where the evidence shows the investments are entirely credit-worthy and socially desirable.

This is what Franklin Roosevelt did in 1933 when he decided that American farmers setting up electricity co-ops were credit worthy, even though banks didn't trust them. Muhammad Yunus did the same thing for enterprise loans to the poor with micro-credit. Now a new class of entrepreneurs are demanding the World Bank step up and do the same for off-grid clean energy access.

While innovations like crowd-funding are needed to disrupt the system, we can't let the system off the hook when it's our money being used. That's why it's exciting to see 22 of the world's leading off-grid clean energy entrepreneurs, as well as the Global Off Grid Lighting Association (GOGLA), demanding social bankability from the World Bank Group in the form of $500 million in risk adjusted investment. Because as countries around the world struggle with the ever increasing burden of austerity, the idea that scarce taxpayer money from donor countries would be used to make risky investments to subsidize a broken system is, simply put, infuriating.

U.S. Treasury Insists That Coal Impacts Be Accounted For

The U.S. Government took an important step to protect local communities from deadly coal pollution by abstaining from a vote on a $900 million funding package for Rio Tinto's Oyu Tolgoi mine in Mongolia. The U.S. Government decision amounts to a vote of no confidence in the International Financial Corporation (IFC) financed project. More importantly it sets an important precedent for coal projects seeking support from the United States -- a welcome sign given its continued support for the Kosovo coal project.

While the U.S. government's support for Kosovo continues to be controversial, Treasury's decision on the Mongolian project was the right one to make, and the Sierra Club commends them for it. Included in the project is a 450-750 MW coal fired-power station that is in clear violation of the Bank's own coal guidance, but which the IFC failed to consider by labeling it an associated facility. When explaining the decision, Treasury officials stated, "The ESIA does not provide a sufficiently detailed analysis of associated facilities and cumulative impacts, notably concerning a coal-fired power plant that will likely be needed to provide reliable power for the project."

The Oyu Tolgoi project has been a boondoggle from the start with, not one, but two open investigations by the IFC Compliance Advisor/Ombudsman (CAO) into impacts on local herders who rely on the region's scarce water resources to survive. While the U.S. vote was not enough to sway the full IFC Board of Directors, which approved the project on February 28, the concerns raised in the U.S. position paper send a strong signal that it is time for the World Bank and IFC to live up to the promise of the Bank's "Turn Down the Heat" report and stop rubberstamping funding for dangerous coal projects.

Today the Sierra Club applauds the U.S. Treasury and hopes that other agencies, including the U.S. Export-Import Bank (Exim), will follow Treasury's leadership and reject financing for Oyu Tolgoi and other dangerous fossil fuel projects.

-- Nicole Ghio, Sierra Club Campaign Liaison

Does Fracking Make You Queasy? So Will the Trans-Pacific Trade Pact.

Today, Japanese Prime Minister Shinzo Abe announced Japan's intention to enter the Trans-Pacific Partnership trade pact (TPP). With Japan's entry, the trade pact will now include 12 nations along the Pacific Rim, including the United States. It's similar to the North American Free Trade Agreement (NAFTA) -- only way, way bigger. And the threats it poses to the health of our families and the future of our planet may be much more severe.

One of the reasons that Japan in interested in joining the trade pact is that countries in the bloc will likely get automatic access to U.S. natural gas. Normally, the Department of Energy is required to examine whether exporting U.S. natural gas is in the public's interest before it makes a decision on whether to export. That is a critical step in building a responsible energy policy that protects the public and the environment. But this crucial requirement is waived for countries that have signed a free trade agreement like the TPP with the U.S.

Coal Killed 100,000 in India in 2012

A groundbreaking new report has, for the first time, estimated the human toll from India's dirtiest fuel source. According to the study, 80,000 to 115,000 people died prematurely as a result of emissions from coal-fired power plants in 2012. Those deaths, along with a slew of other health impacts, including millions of cases of asthma, respiratory distress, and heart disease caused by coal emissions, cost the Indian government $3.3 to $4.6 billion. The toll is staggering and it comes at a time when the Indian government seeks to dramatically expand its reliance on this destructive fuel source with a pipeline of coal projects matched only by China.

The study, conducted by Delhi-based research group Urban Emissions (India) and commissioned by Conservation Action Trust in partnership with Greenpeace, reveals the health impacts of some of the weakest air pollution standards in the world (see the comparison of emissions from the International Energy Agency below). Debi Goenka of Conservation Action Trust says of Indian emission standards, "They are either absent or shamefully behind those of even China, let alone the EU or U.S. Does the Ministry of Environment consider Indian lives to be less valuable?"

U.S. Challenges India’s Solar Energy Incentives at WTO: What’s at Stake

The transition to a clean energy economy is imperative not only to tackle the climate crisis but also to spur development through new economic opportunities, new investment, and the creation of new green jobs. In seeking to capture these benefits, however, governments are increasingly turning to trade rules to challenge each others' domestic renewable energy industries, thereby undermining the global clean energy transition we all seek. Put simply, all governments must have the ability to develop domestic renewable energy industries to fight climate change and the entrenched fossil fuel industry behind the crisis.

In the most recent example, the United States has filed a case at the World Trade Organization (WTO) to challenge India's use of subsidies and "buy local" rules in its domestic solar program. This case exemplifies the misguided and harmful impacts of these challenges. It is particularly important because of India's potential as one of the world's largest solar markets and because of the local and global benefits to India's transitioning from fossil fuels to renewable energy.  

Our Distributed Future: M2M, Energy, and Water Access

Three out of every four new mobile phone subscribers are now in the developing world. This monumental shift has created a unique population of hundreds of millions of off-grid mobile phone users who don't have access to basic necessities like energy or water, let alone essential services like banking. Thanks to mobile phones, however, they have access to a distributed infrastructure through machine to machine technology (M2M) that can enable access to these vital services. That's what new GSMA research is telling us, and the implications are too exciting to ignore. 

 

Let's start with the basics. The rural poor lack access to just about everything. From basics like energy and water to inclusion in the financial system, their lack of "connectedness" to the world inhibits their escape from poverty. Until now the solution to this problem was to invest large sums in centralized infrastructure to enable it to extend out to these communities. The problem is this approach is not only top down and ineffective it also is really expensive and contributes to problems of corruption, mismanagement, and environmental degradation. But mostly, it just hasn’t worked.

Mobile phones have famously bypassed traditional infrastructure efforts to enable connectivity to even far-flung communities through the creation of a distributed network of off-grid cell phone towers. This distributed infrastructure flies in the face of decades of traditional policymaking and its squandered investments. More importantly it offers opportunities to change course that entrepreneurs, NGOs, and policymakers must seize.

Trans-Pacific Partnership: Wrong Trade Deal for the U.S.

The massive Forward on Climate rally in Washington, D.C. last weekend bears a significant relationship to the ongoing negotiations for a trade agreement spanning the Pacific Rim, but pointedly excluding China.

The Obama administration is in the closing stages of negotiating an agreement with 10 other countries, with others hoping to join, that dwarfs any previous U.S. trade agreement since we joined the World Trade Organization. It’s bigger than NAFTA (the North America Free Trade Agreement) and it now includes both Mexico and Canada. Its environmental, social and political significance will probably be greater than the World Trade Organization, as the expansion of the scope of that organization has stalled.

The Sierra Club has chosen to make energy a key element in its deep concern about the emerging Trans-Pacific Partnership (TPP) trade pact. Click here for more. Currently, the U.S. enjoys a surplus of natural gas, which has driven down producer prices. Export of that surplus is seen by the industry as the solution, as they are in a “use it or lose it” bind. Currently, export of natural gas is tightly controlled by the federal Department of Energy, but if the TPP agreement goes through, its likely provisions would prevent the U.S. from such restrictive enforcement rules, much to the joy of the industry. Suddenly, any restrictions on petroleum exports could vanish, and many Pacific Rim countries would be more than happy to buy what we couldn’t refuse to sell. The same situation would apply to other hydro-carbons, some of which, such as coal, we have in abundance.

Corruption Allegations, Monster Mine Madness, and the US Ex Im Bank

Despite President Obama's commitment to tackle climate change, the U.S. Export-Import Bank (Exim) President Fred Hochberg continues to underwrite some of the world's largest and most destructive fossil fuel ventures. He has personally overseen financing for massive coal projects coal projects in South Africa and India. But the Bank has run up against a determined international resistance to its most controversial project to date – a pair of coal mega mine and export terminals that would ship millions of tons of coal through the Great Barrier Reef near Australia.

Greenpeace Australia dubbed one of these projects, Adani's proposed Carmichael mine, Monster Mine Madness. If completed, the mine would be Australia's largest ever, sucking up 10 billion liters of water and emitting 128 million tons of carbon pollution annually. That's more carbon than Sweden, Norway, and Denmark emit combined. To accommodate the enormous output of this mega mine, Adani is planning to expand its existing Abbot Point terminal and build two more ports to ensure the 60 million tons of coal can be dumped on international markets - after traveling through the Great Barrier Reef.



Now, Greenpeace Australia has uncovered new information on Adani's corrupt history in India (PDF), including a bribery scandal, illegal ore exports, illegal construction on private land, concealing and falsifying facts in application processes, and activity without environmental clearances. These shady practices resulted in the flooding of villages, massive losses in tax revenue, and the destruction of critical tiger habitat and mangroves.

Australian Federal Environment Minister Tony Burke has called Greenpeace's revelations "serious" and insisted they must be investigated. Meanwhile, Greenpeace Australia and the Lock the Gate Alliance have uncovered evidence that Adani has already brought their illegal practices to Australia by starting to clear the Carmichael Mine site before acquiring approval from the government.

With evidence mounting that Adani is a corrupt company (PDF), and worldwide uproar to save the Great Barrier Reef, one would think that Fred Hochberg would keep Exim and our taxpayer dollars as far from the Monster Mine Madness as possible. But Hochberg has remained steadfastly determined to support outdated fossil fuel projects that should be regulated to the previous century. But with concerted international resistance, and White House leadership, Hochberg may yet surprise us and finally do the right thing.

-- Nicole Ghio, Sierra Club

The Great Indian Coal Bailout

Those paying attention to the Indian coal sector know that it's in a state of crisis. Coal supplies for the number of planned plants are largely an illusion, plants that have been built are going bankrupt, and financiers publicly call it a 'distressed sector'. Add to that the ongoing Coal-Gate scandal and it's clear that politicians facing elections would want to steer far clear of this mess.

Instead they have doubled down with their latest move to bail out financial boondoggles like the Tata Mundra project by approving skyhigh subsidies to imported coal-based power plants. But with elections around the corner this may prove a step too far in the great Indian coal bailout.

New Ads Highlight World Bank's Deadly Coal Plans For Kosovo

Despite the World Bank president Dr. Kim's high-profile calls to tackle climate change, the institution continues to barrel forward with its support for a dirty new coal plant in Kosovo. Local civil society has made their opposition to these plans abundantly clear. However, even with a climate and health activist at the helm, the Bank refuses to change course. Now, armed with the World Bank's own statistics, and some devastating public health advertisements, Kosovar civil society is opening a new front in the battle against coal.

Their fight is premised on a simple but devastating truth: coal plants kill. In Kosovo, they kill 835 people every year according to the World Bank's own statistics. Those stats, are found in a report (PDF) released in September 2012. The same report includes a bevy of alarming data about the impact of pollution on the health of Kosovo residents:

• 835 early deaths;

• 310 new cases of chronic bronchitis;

• 22,900 new cases of respiratory diseases among children (most often asthma);

• 11,600 emergency visits to country’s hospitals;

Over 100 million euro in direct costs connected to this problem, all of which were paid from the pockets of already impoverished Kosovo citizens.