Bank Rebuked For
Fossil Fuel Strategy
By Paul Brown
22 June , 2004 by
World Bank's drive to promote fossil fuel-generated power for 1.6 billion
people lacking electricity will drive developing countries deeper into
Fossil fuels, such
as oil, gas and coal, will never provide enough power for developing
nations because of the cost of connecting remote communities to a national
grid, whereas renewable forms of electricity generation could provide
a cheaper solution, says the think tank New Economics Foundation.
The subsidies paid
by the World Bank and export credit agencies to fossil fuel industries
to expand in the developing world, particularly Africa, are driving
countries deeper into debt rather than helping the poor as is the declared
intention, stresses the foundation. It criticizes the president of the
World Bank, James Wolfensohn, who has dismissed renewables as an expensive
solution. The report says Mr Wolfensohn "at best has a bad grasp
of basic economics and at worst reflects the entrenched interests of
the Bank's major donors, the fossil fuel industries".
in poorer countries, particularly in Africa, are often many miles from
any kind of power grid. On current trends, in 2030 there will be more
people relying on wood and dung for cooking and heating than there are
now, according to the International Energy Agency.
But with small-scale
hydro-electric schemes, wind and solar power, developing world villages
could become self-sufficient in power. And the death rate among women
and children from respiratory diseases brought on by fumes from unsuitable
stoves would fall dramatically.
Already one scheme,
in Rajasthan, India, has given 130 remote villages, home to 15,000 people
in all, solar power in place of kerosene and candles, allowing 200 women
to gain work via electrically powered spinning wheels.
On Mindanao, in
the Philippines, where there was no hope of a grid connection, a micro-hydro
scheme is providing power to 110 households and public buildings, cutting
out the need for diesel. On the island of Sagar, Bengal, five solar-powered
photovoltaic plants produce electricity for various outlets, including
1,600 families. Wind power is being added to the energy mix to pump
are able to exercise a greater degree of self determination, says the
report. Renewables not only improve quality of life and reduce carbon
dioxide emissions, they provide educational opportunities as well as
This path out of
poverty contrasts with the route offered by the World Bank, the International
Monetary Fund and the World Trade Organization, where alongside large-scale
coal, gas and oil power projects, corruption can leave little of the
money generated in the hands of local people and much of the profit
passed on to developed countries.
For the poorest
countries, one advantage of renewables lies in not increasing debts
by importing ever more fuel. Once installed, renewable energy facilities
incur only maintenance costs. In a further step, reduced debt and spending
on energy imports lessen the need to generate foreign exchange revenue
through exports and local economies can focus on meeting domestic needs,
the report says.
Currently less than
3% of the £25bn spent annually on energy investment in developing
countries goes to renewables. Providing solar electricity to a village
of 50 households in sub-Saharan Africa costs an average of £17,000.
There are about
500 million people in Africa without electricity, but one year's spending
on fossil fuel by the World Bank, redirected to renewables, would provide
power for 10 million, the report says.
Guardian Newspapers Limited 2004