We’re being blocked from coal because it’s not green, and there’s some hypocrisy in that,” said Adeosun, speaking at the IMF annual meeting in Washington DC on Wednesday. “We had an entire Western industrialisation that was built on coal-fired energy, and that’s the competitive advantage that’s been used to develop Britain, certainly, where I grew up.”
She continued: “Now Africa wants to do it, we get ‘it’s not green, you can’t do it, you should go do solar and wind’, which is the most expensive power form… Those who started it should lead. Those who have been doing it for 200 years should not tell us not to do it.”
Her remarks were partly in reference to the reported split between the African Development Bank and the World Bank over partial risk guarantees.
In spring 2015 the AfDB set up a partial guarantee with Nigerian Bulk Energy Trading, but, according to NBET’s president, the World Bank declined to support the facility because it financed coal. The AfDB extended further risk guarantee facilities to NBET and the Nigerian power network TCN in July this year, again without the World Bank’s involvement.
But the debate is far wider than that.
Many of the investment banks which signed agreements to stop financing coal power in the wake of the Paris agreement carved out lending to developing or emerging economies. BNP Paribas and Sociéte Générale, for example, pledged no new lending to coal in high income countries, while HSBC pledged no new lending to projects with a carbon intensity of more than 850g per kilowatt hour — but put in place a lower cap of 550g for richer countries.
Adeosun’s views were echoed by Professor Paul Collier, also part of the panel session of infrastructure in developing countries, and by Anders Borg, former finance minister of Sweden and chair of the World Economic Forum.
Collier said: “What’s the sensible and ethical way to close the coal industry? Start with richest and finish with poorest.”
He asked Adeosun whether she would commit to closing coal if rich countries did it first, and she replied: “Of course, because it would be fair.”
Jonathan Taylor, vice-president of the European Investment Bank, pointed out that the West was now at least being consistent — the EIB’s guidelines for new lending use the same 550g cap as HSBC, which according to Taylor, virtually rules out coal.
But, challenged on the EIB’s back book by Borg, he acknowledged that around 20% of its energy project portfolio was still coal-fired.