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EBRD: TIME TO CHANGE YOUR ENERGY POLICY.

Nuclear Monitor Issue: 
#618
12/11/2004
Article

(November 12, 2004) In mid October the European Bank for Reconstruction and Development (EBRD) announced that it would review and merge its Energy and Natural Resources Policies, copies of which can be seen at www.ebrd.com.

(618.5650) Antony Froggatt - The EBRD is the only International Financial Institution (IFI) to fund nuclear power. Earlier this year, the Bank awarded a US$42 million loan to complement an US$80 million loan from the EU, through the Euratom Loan Facility, for the controversial Khmelnitsky 2 and Rovno 4 (K2R4) nuclear reactors in Ukraine. This was the first time the EBRD have funded a nuclear power project, however, it had previously attempted to fund the completion of Mochovce in Slovakia and the previous version of the K2R4 project in Ukraine.

Other international and regional financial institutions do not fund nuclear power. Even the World Bank, not renowned for its environmental awareness, has a policy not to fund nuclear power projects directly; similarly the Asian Development Bank has a specific non-nuclear policy.

When the EBRD was founded in 1991, it was the first IFI to have in the Bank's founding charter a requirement to promote in the full range of its activities, environmentally sound and sustainable development. Since then its energy lending has not lived up to this requirement. In addition to lending for nuclear power, the Bank has failed to create a lending target for renewable energy projects and approved loans for the extensive development of the oil and gas sectors in Russia and Caspian Region while failing to adequately protect the environment and rights of the local population.

According to the bank's Environmental Policy "the EBRD may also carry out Strategic Environmental Assessments (SEAs) on the likely environmental consequences of proposed sector or country/regional plans or programmes which have the potential to significantly affect the environment". However, despite numerous proposals from the CEE Bankwatch Network and the recommendation of the Fourth Ministerial Conference "Environment for Europe", held in Aarhus in June 1998 (1), to carry out a Strategic Environmental Assessment, the EBRD refused to conduct an SEA of the new Energy Policy and did not provide any rationale for such a decision.

The EBRD should now reform its energy policy by:

  • Altering its energy policy so that it can no longer lend to nuclear power projects.
  • Introducing binding targets for loans for renewable energy and accelerating programmes to support the development of the technology in the region. This could significantly aid renewable energy in Central and Eastern Europe and in particular enable the new EU Member States to meet their renewable energy targets.
  • Establishing and enforcing clear requirements for projects involving extractive industries.
  • Proving its commitment to sustainable development by conducting a Strategic Environmental Assessment of the draft Energy Policy, what should obviously include the evaluation of possible alternative scenarios.

 

The policy revision will take place in three distinct phases.

  • Comments on the existing policies should be sent to the EBRD by 15 December to energypolicyreview@ebrd.com
  • Regional workshops on the existing policies will take place in London, Moscow and Sofia before the end of 2004. If you wish to take part in these hearings or would like more details then contact: ngo@ebrd.com
  • A revised draft is scheduled for publication in March 2005, which will be followed by a 45-day consultation period. The Bank's Board of Directors, made up of representatives of European and international governments, should then adopt this.

 

NGOs and citizens are encouraged to contact the EBRD with comments on the existing policies as well as the process of policy consultations and request to be kept informed of the process by emailing ngo@ebrd.com.

For more information contact Yury Urbansky -urbik@bankwatch.org- at CEE Bankwatch Network or visit www.bankwatch.org

Notes:
(1) The Ministers agreed that: "…a strategic environmental assessment facilitates the systematic analyses of the environmental impacts of proposed policies, plans and programmes and invite countries and international finance institutions to introduce and/or carry out strategic environmental assessments with the appropriate participation of NGOs and citizens."

Professor Yablokov's workshop concluded with the drafting of a letter, addressed to the UN Secretary General with copies to the IAEA and national representatives to the UN and will be sent before 1 March 2005 - the anniversary of the H-bomb test at Bikini Atoll. The letter draws attention to some of the obvious deficiencies in international nonproliferation regimes, states the connection between nuclear power and nuclear weapons and suggests substituting the IAEA with a new agency for the promotion of renewable energy amongst other things.

Source: Antony Froggatt
Tel: +44 20 7923 0412
Email: a.froggatt@btinternet.com
Web: www.eu-energy.com