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Overseas Aid: Fossil Fuels

Volume 491: debated on Wednesday 22 April 2009

To ask the Secretary of State for International Development what his policy is on the provision of (a) loans and (b) loan guarantees by multilateral development banks to fossil fuel projects overseas; and if he will make a statement. (265215)

In October 2008 the Governors of the World Bank agreed a new strategic framework for climate change and development that will integrate climate change adaptation and mitigation into its core activities. The framework sets out a series of considerations that will govern decisions on financing for new coal power projects. Details of these are available on the World Bank's web-site:

http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/ENVIRONMENT/EXTCC/0,,contentMDK:21876999 ~menuPK:4849391~pagePK:210058~piPK:210062~theSite PK:407864.00.html

The UK worked with the Bank in developing the Framework and led calls for its adoption. The Department for International Development (DFID) is continuing work with the World Bank and other multilateral development banks (MDBs) to develop these criteria further and identify how they should be applied to fossil fuel projects across the MDBs.

The clean energy investment framework agreed by the Gleneagles G8 in 2005, has led to an increase in low carbon energy investments by the MDBs representing $117.7 billion of leveraged investment. Our £800 million contribution to the climate investment funds will help provide some of the additional resources needed to help support this.