How DFID funds fossil fuels
Demands
People & Planet is calling on DFID to produce an energy and climate change strategy, covering both bilateral and multilateral funding, which will:
Ensure DFID’s activities actively contribute to mitigating climate change through global emissions reductions. To do this, People & Planet believes DFID must:
i. Phase out all support for fossil fuel extractive projects.
ii. Massively increase support for new renewable energy sources.Increase access to energy in the developing world.
The strategy must have specific, timebound targets and built in monitoring systems. DFID should report to Parliament on progress towards these targets on a regular basis.
Fossil fuel extraction and exploration is currently funded with UK taxpayers’ money through the World Bank and other international financial institutions. This is money which is supposed to be spent on DFID’s mission of ending poverty.
The World Bank has recently increased its support for fossil fuel extraction and exploration projects, from $462 million in 2005 to $842 million in 2006. This is despite an internal review of such funding in 2004 which recommended that the Bank should phase out funding for these projects on environmental, social, human rights, and development grounds.
The UK supports this use of development money for fossil fuel projects, and has used its position to influence the World Bank, opposing the proposed phase out of oil funding. DFID continues to argue that oil and gas extraction can have a positive impact on development, despite the fact that the World Bank have been unable to put forward a single example of an oil project that has alleviated poverty.
For more information on DFID see their website.
A low carbon future
Micro wind turbine
S Windjue 2005
Rather than spending development aid on fossil fuel extraction, it should be targeted at low carbon development. Providing energy services to those who currently are without electricity is vital for poverty reduction. Small scale, decentralised provision of energy can be cost effective, efficient and environmentally sustainable. Using renewable energy can also reduce dependence on fossil fuel imports.
DFID are publicly supportive of renewable and decentralised energy, and in April 2007 called for the World Bank to adopt higher targets for spending on renewable energy. This is a very welcome move. Increasing funding to renewable energy will not be enough on its own, without simultaneously phasing out investments in fossil fuels. Funding for oil and gas dwarfs spending on renewables.
Facing the challenge of climate change requires decisive action and global leadership. People & Planet is calling on DFID and the UK Government to ditch dirty development and put all their political and economic weight behind a new energy strategy for a climate friendly future.
Further Reading
You can read more on the DFID side of the campaign in the Fueling the Future report.