OPINION: Japan’s Misuse of Climate Funds for Dirty Coal Plants Exposed

By Dipti Bhatnagar Reprint | | Print |

Dipti Bhatnagar is Friends of the Earth International's climate justice and energy coordinator.

Photo courtesy of FoEI

LIMA, Dec 3 2014 (IPS) - World governments gathered in Lima, Peru for the latest round of U.N. climate negotiations should have finance on their mind.

Making a just transition to a climate-safe future means helping developing countries to deal with damage from climate change, equipping them with the technology and skills to adapt to new circumstances, and to continue to develop on their own paths in the face of the climate crisis.

This is the repayment of the ‘climate debt’. All this requires money – money which developed countries, as the largest historical contributors to climate change – should provide. Some countries have already made announcements about the finance they are contributing.

But guess what? Some of this funding is being spent on projects which worsen and compound the climate crisis.

Let’s take the Cirebon power plant in Indonesia as an example. By some truly confusing logic, this pollution-belching coal-fired plant counts as part of Japan’s efforts to combat climate change. Why? Because Cirebon and two others like it in Indonesia were funded by Japan using climate finance funds, according to a Dec. 1 report by the Associated Press.

In other words, Japan financed a coal-fired power plant in a developing country using money that was supposed to help developing countries tackle climate change. The flimsy reasoning behind this claim is the idea that because this plant uses newer, more expensive technology than Indonesia would have afforded alone, the emissions are somehow ‘cleaner’.

Coal is by far the carbon heaviest fossil fuel, posing multiple dangers to the environment, atmosphere and human health. The Associated Press goes on to say “Villagers nearby also complain that the coal plant is damaging the local environment, and that stocks of fish, shrimp and green mussels have dwindled.”

Friends of the Earth Indonesia/WALHI has been campaigning against these plants, and condemning the warped thinking that this plant is marginally better than some hypothetical dirtier plant. It is dirty and it contributes to climate change and wrecks local livelihoods. Financing should not go to dirty energy.  Simple as that.

Japan plans to finance more of these projects in other parts of the world. Japan’s dirty energy corps seems to have done an impressive job of convincing the government that financing their polluting activities is actually helpful for developing countries.

Friends of the Earth Japan is also campaigning on this issue at home, pressuring the Japanese government to be more responsible with their financing and not fund dirty energy.

The lack of coherent rules defining proper  climate finance is very worrying. The Green Climate Fund (GCF) has been set up to manage the transfer of much needed finance from developed to developing countries.

But the GCF still suffers from dismally low finance pledges compared to what is really needed to stop the climate crisis. The lack of rules for what constitutes as climate finance is the most worrying.

In a letter sent to the GCF in May 2014, social movements and civil society organisations, mostly from the Global South, urged that dirty energy be excluded from the GCF funding list and stressed the importance of real climate finance.

“The Green Climate Fund is of vital concern for us, as the mobilization of unprecedented levels of finance is urgently needed as part of an immediate as well as strategic response to the climate crisis. We urge you to make it an explicit policy that GCF funds not be used for financing fossil fuel and other harmful energy projects. We note with grave concern and alarm how other international financial institutions have been financing these types of projects under their ‘climate’ and ‘clean energy’ programs,” the letter said.

Yet the atmosphere at the climate talks in Lima, and in much of the reporting on the talks so far, is shockingly optimistic. The recently announced US-China deal has been celebrated by many, but the deal is hollow. It provides paltry insufficient, non-binding pledges to reduce emissions that are completly out of sync with what scientists tell us is needed to stop catastrophic climate change.

As long as deals and promises are made more for their symbolic nature than for their actual substance, we will continue to undermine real climate action and we will miss real opportunities to overcome the climate crisis and create a just and secure future for everyone.

Asad Rehman of Friends of the Earth England, Wales and Northern Ireland compared the lack of a regulatory framework with binding emissions targets and meaningful financial commitments to the ‘Wild West’, where countries are free to reduce or not to reduce emissions and to finance polluting activities in the pursuit of profit, as if our planet was not experiencing a grave start of a massive climate crisis.

Worse than the empty efforts of some rich countries is the absence of meaningful oversight of climate finance. Without adopting a shared understanding that climate finance is to help developing countries implement renewable, community-owned energy and to tackle climate change, and without clear guidelines on how the money should be used, we will continue to see half-hearted measures at best and countries exploiting the crisis for their own profit.

“Climate finance is such a mess. It needs to get straightened out,” said Karen Orenstein of Friends of the Earth U.S. “It would be such a shame if those resources went to fossil fuel-based technologies. It would be counterproductive.”

Not only should this round of U.N. climate talks emphatically refute fossil fuels and explicitly rule out any further use of climate funding for dirty energy projects, but they should also adopt real, meaningful clean energy solutions.

The GCF should be funding energy transformation ideas such as the Global feed in Tariff (GfiT), which would subsidise renewable energy until such time as it becomes cheaper than fossil fuel energy through wider adoption and improvements in technology.

Within the U.N., rich developed countries must meet their historical responsibility by committing to urgent and deep emissions cuts in line with science and equity and without false solutions such as carbon trading, offsetting and other loopholes.

They must also repay their climate debt to poorer countries in the developing world so that they too can tackle climate change. This means transferring adequate public finance, technology and capacity to developing countries so that they too can build low carbon and truly sustainable societies, adapt to climate change already occurring and receive compensation for irreparable loss and damage.

But the U.N. talks are heading in the wrong direction, with weak voluntary non-binding pledges and pitiful finance pledges from developed countries, with huge reliance on false solutions like carbon trading and REDD.

Edited by Kitty Stapp