World Bank initiates carbon footprint analysis.

The World Bank, in collaboration with the world's leading multilateral development banks, is creating a common method for estimating the greenhouse gas emissions associated with development projects. The assessments are expected to bring greater transparency to lender investment portfolios and to encourage developing country clients to follow low-carbon development paths, analysts said in July.

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The Bank's decision to measure project-level emissions comes after decades of pressure from nongovernmental groups to shift multilateral lending away from carbon-intensive projects such as coal-fired power plants and toward renewable energy and energy efficiency. According to former Environmental Defense Fund senior counsel Bruce Rich, the World Bank Group, Asian Development Bank, and European Investment Bank are among the top five public international financiers of coal-fired power since 1994. Their collective investments total more than US$23.3 billion in 96 fossil fuel-related projects across the developing world.

The World Bank already analyzes the greenhouse gases associated with its Carbon Finance Unit investments, which include projects in the areas of renewable energy and energy efficiency. And the International Finance Corporation, the World Bank Group's private sector arm, began developing an emissions accounting system in 1997.

Some Bank officials and their developing-country clients worry, however, that certain projects may be disproportionately affected by a greenhouse gas accounting system. An investment such as a highway, for instance, will unavoidably lead to emissions through the clearing of land and encouragement of greater vehicle use.

by Ben Block

(unless otherwise credited)