International energy lending: who funds fossil fuels, who funds energy access for the poor?
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Energy demand is surging in the developing world, and international organizations play an important role in the funding of energy projects. However, there is virtually no empirical analysis of how different organizations choose their project portfolios. This article examines the energy funding of different international organizations, with a particular focus on the World Bank’s International Development Association (IDA) and International Finance Corporation (IFC). We use data on 888 projects in 128 recipient countries funded by nine major international organizations during the years 2008–2011. Relative to other organizations, the IDA is found to invest less in fossil fuels and more in projects that improve energy access for the poorest people. The IFC emphasizes fossil fuels while downplaying the importance of energy access. Overall, fossil fuels now receive only a minority of energy funding. However, energy access is only emphasized in a tiny minority of projects.
KeywordsInternational organizations Energy policy Fossil fuels Clean energy Development assistance World Bank
International Finance Corporation
International Development Association
Multilateral Investment Guarantee Agency
International Bank for Reconstruction and Development
We thank Christopher Marcoux, Alice Xu, the editor of International Environmental Agreements, and the anonymous reviewers for comments on previous drafts.
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