New policies that cut financing for dirty energy projects abroad might meet a premature end if some American lawmakers have their way.
The United States Congress is currently entangled in a wide-ranging debate on the fate of the Export-Import Bank, a little-known government agency that finances the foreign purchase of American exports.
Just last December, the bank announced new plans to bring its operations in line with President Obama’s Climate Action Plan by deciding to halt lending to high carbon intensity power plants, except in the world’s poorest countries.
Now, a senator from West Virginia, one of the country’s most coal-rich states, is pushing to renew the Bank’s charter—but only if the bank’s environmental standards are struck down.
The Hill reports that the senator, Joe Manchin, is preparing a bill that would reauthorize the Import-Export Bank, while all but obliterating provisions that restrict overseas coal financing. Manchin explained:
There are seven billion tons of coal being burned outside the U.S. each year. If we are truly committed to cleaning up our global environment, the U.S. should lead the world in clean coal technology and export that technology to the rest of the world.
However, rhetoric about “clean coal” is just that. Without question, the process of extracting and using coal is incredible destructive to the environment and to human health.
According to the World Health Organization, up to 7 million premature deaths—one in eight worldwide—occur each year as a result of air pollution, much of it caused by coal-fired plants. Meanwhile coal plants are the biggest source of human-caused greenhouse gas emissions, responsible for a full one-third of CO2 released into the atmosphere.
Climate change, which is the greatest environmental challenge ever faced by mankind, cannot be curtailed unless emissions are sharply cut. And this means either phasing coal out of the world’s power mix or embracing new technologies that will inject emissions into underground rock formations.
If Manchin’s proposal finds success in Congress it will be a victory for select fossil fuel boosters over the global public interest. The Export-Import Bank lends $27 billion per year, with roughly one quarter of that money sent to energy projects.
And although the bank’s financing for coal projects was falling before the ban, reversing course could still have big consequences.
Between 2007 and 2012, the bank loaned a whopping $5.2 billion to dangerous coal projects in locations like India and South Africa. It’s likely that if lending for coal plants becomes permissible, the bank will help support a massive 3,960 megawatt coal plant and mining facility in Jharkand, India. This plant has been the object of local ire, with many nearby residents fearing that it will disrupt the economy and foul local air.
Reinstituting financing for overseas coal would also move the United States backward as compared to other nations and major lending institutions. The World Bank, the US Trade and Development Agency, the European Investment Bank and the European Bank for Reconstruction and Development have all declared they would only fund coal projects under rare circumstances. The same is true for the governments of Britain, Sweden, Norway, and Finland.