Environmental campaigners are warning the UN fund set up to help developing nations tackle climate impacts and transition to a clean energy economy, could be spent on coal-fired power plants under new rules agreed at its board meeting last week.
That means that the Green Climate Fund (GCF) – formed to help fight climate change – could be used to drive further use of the most polluting form of electricity generation, after the board refused an explicit ban on fossil fuel projects at its meeting in Songdo, South Korea.
Commentators warned leaving the door open to funding coal is unacceptable. Karen Orenstein, a campaigner for Friends of the Earth US, told the Guardian:
It’s like a torture convention that doesn’t forbid torture. Honestly it should be a no-brainer at this point.
The Green Climate Fund was created as part of the 2009 Copenhagen Accord.
A year later, the fund was formally established and government’s pledged to raise $100 billion for the fund annually by 2020.
Last year, the fund reached it minimum goals of $10 billion in pledges, as countries met at the UN climate conference in Lima, Peru.
But commentators warn that with no clear rules on climate finance, the fund risks channeling large sums of money into dirty energy.
Last year, an article from Associated Press exposed $1 billion in loans that Japan had given to coal plants in Indonesia under the banner of climate finance.
And despite mounting protests against the country’s action, last week the news service again reported that Japan is financing the building of coal-fired power plants with funds earmarked for fight climate change, with new projects in Bangladesh and India.
That’s another $630 million in climate finance going into coal plants in Kudgi, India and Matarbari, Bangladesh, according to Japanese officials.
The government argues that the projects are climate friendly because they use technology that burns coal more efficiently, reducing emissions compared to older coal plants.
But commentators warn climate finance should be earmarked for real climate solutions, such as renewable energies.
ActionAid’s Brandon Wu told AP:
Japan’s support for new coal-fired power plants not only destroys the climate, it also displaces communities, is likely to cause untold local environmental damage and primarily benefits Japanese companies instead of recipient countries. This is unacceptable on its own, and the fact that it is being done in the name of ‘climate finance’ makes a farce of the entire concept.
It was Japan, along with China and Saudi Arabia opposed a ban on coal at the Green Climate Fund meeting in Korea last week, according to Friends of the Earth US.
Campaigners warn that the “integrity” of the Green Climate Fund could be at risk as the lack of clear rules makes a mockery of the system.
The board agreed to set a minimum benchmark for the greenhouse gas emissions cuts that projects must achieve, but not until 2016.