SUNS  4323 Friday 13 November 1998

Washington, Nov 11 (IPS/Abid Aslam) -- Environmentalists want a clear accounting of the World Bank's role in financing projects resulting in emissions of harmful 'greenhouse gasses'.

A broad coalition of think tanks and activist groups also wants to know what the Bank is doing to reduce emissions, blamed for global warming, in future projects.

They have taken their demands to Buenos Aires, Argentina where countries are meeting Nov. 2-13 for talks on achieving greenhouse gas reductions, a goal to which governments committed themselves in Kyoto, Japan last December.

Greenhouse gases are released mainly when fossil fuels, such as coal, oil and gas, are burned. Most scientists blame them for raising atmospheric temperatures and altering Earth's climate, with
far-reaching implications for health, the environment and economic activity.

The dangers include the spread of tropical diseases, such as malaria, to what are now temperate zones sand the loss of agricultural land to deserts. Rising sea levels also can cause the loss of coastal areas and, most dramatically, entire island countries.

'Green' groups want the Bank to come clean on the amount of carbon that has been - and likely will be - pumped into the atmosphere as a result of its loans.

Furthermore, the groups - including Friends of the Earth, the Centre for International Environmental Law, the Environmental Defence Fund, and the Pacific Environment Resource Centre - are calling on the Bank to reform its lending policies. They want to see greenhouse gas emissions in the Bank's energy and transportation portfolios reduced by at least 10% per year beginning in 1999.

According to the Institute for Policy Studies, since 1992 the global lender has ploughed 25 times as much money into projects exploiting fossil fuels as it has committed - directly or with the multi-donor
Global Environment Facility - to wind, solar, and other 'renewable' power projects.

The Institute also maintains that loans in 1992-97 resulted in the release of 9.5 billion tons of carbon into the air but the Bank puts the figure at 1.4 billion tons. In comparison, total global emissions
in 1995 amounted to 6.5 billion tons, according to environmentalists.

Robert Watson, the Bank's environment department director, acknowledges an imbalance in lending. He maintains, however, that the agency lends seven dollars to fossil fuel projects - not 25 - for every dollar it earmarks for renewable technologies. "The numbers are highly distorted," he says.

"We are lending more for fossil fuels than for renewables but we have to be pragmatic," Watson says. "China has lots of cheap coal. They're going to use it. The Bank should be involved in cutting-edge projects using more efficient technologies."

Watson adds that, in addition to pushing relatively 'clean' technologies, the lender should rely more on 'green accounting' to show that traditional energy projects, while appearing to be relatively
cost-effective in the short run, involve costs in the long run. These include cleaning up pollution and dealing with respiratory diseases and other health problems related to 'dirty' technologies.

By 'internalising' those long-term costs in its calculations of a proposed project's actual worth, he argues, the Bank should be able to tip the scales in favour of cleaner technologies - and hopefully even renewable alternatives.

Clouding the outlook for success, however, is the absence of an accurate yardstick by which to measure the climate change impact of the Bank's lending. Likewise, disagreement over how to tally the financial figures is hampering efforts to account for past projects.

The Bank relies on the Intergovernmental Panel on Climate Change to guide it in calculating greenhouse gas emissions. But, as the groups say in a letter to acting U.S. assistant secretary of state Melinda Kimble, the panel "does not have a methodology for calculating greenhouse gasses associated with international financial institutions - only for countries".

National authorities are able to calculate existing emissions at their point of release - for example, a coal-fired power plant. But to get a reliable reading of lenders' impact on the global climate, the groups say "it is essential to calculate carbon emissions that WILL be released from projects they help finance." That is a decidedly more tricky undertaking, but crucial if the Bank is to assess projects prior to approving them.

Activists blame that lack of a clear methodology for the World Bank's failure to deliver on the 1997 pledge by Bank President James Wolfensohn, to calculate greenhouse gas emissions involved in any loans.

"By its own admission, the World Bank will exclude from its calculations all coal, oil or gas reserves which the Bank helps open up for exploitation," the groups say in their letter. "Our figures suggest
that these projects constitute roughly 90 percent of the future emissions associated with World Bank energy lending."

The 'Greens' concede that the Bank "is to be commended...for significantly upping their investment in renewable energy and energy efficiency in the last year" - although performance still falls short
of the Bank's own targets.

The groups say their call for a full accounting from the Bank got a boost in May, when environment ministers from the seven leading industrial nations and Russia urged that "the policies and operations of the World Bank and other international financial institutions take full account of climate change".