Heavy investment in fossil fuels by international financial institutions in Western Balkan countries is hindering their compliance with EU climate targets, a report says.
A new report entitled "Invest in Haste, Repent at Leisure" says energy investments by development banks are jeopardising the ability of Balkan countries to meet EU energy and climate targets.
The report by the civil society organizations CEE Bankwatch Network, SEE Change Net and WWF says Europe's development banks are spending far more on fossil fuels in the region than on renewable energy sources not related to hydropower.
"This trend means that the Western Balkan countries are heading in the opposite direction of the EU goals on climate change for the years 2020, 2030 and 2050, an eventual requirement for these aspiring EU countries," the report said.
The report reveals that almost half of the energy lending of the EBRD the largest public lender in the region has supported fossil fuels, with only 2 per cent of its portfolio allocated for non-hydropower renewable energy sources, and a further 23 per cent supporting hydropower.
"Fossil fuels account for 36 per cent of all IFI [International Financial Institutions'] energy financing in the region, or €597.3 million, with hydropower receiving €310.1 million and renewable sources just €18.5 million, or 1 per cent," the report said.
The report also said that energy efficiency, which has a high potential to address energy poverty in the region and prevent new environmentally-impacting infrastructure, makes up only 17 per cent of the IFIs' energy portfolio, or €288.8 million.
Pippa Gallop, research co-ordinator at CEE Bankwatch Network and co-author of the report, said: "This is totally unacceptable for institutions who have a very specific role in supporting new, environmentally- and socially-sound investments rather than simply investing in whatever governments or companies propose."
SEE Change Net, CEE Bankwatch Network and WWF have called for a halt to international public investments in fossil fuels and for more effort to be invested in energy efficiency and energy savings.
The report was created as part of SEE SEP (South East Europe Sustainable Energy Policy) programme. SEE SEP partner organizations are: SEE Change Net (regional), Analytica (FYR Macedonia), Cekor (Serbia), CPI (Bosnia and Herzegovina), CZZS (Bosnia and Herzegovina), DOOR (Croatia), EDEN (Albania), Ekolevizja (Albania), Eko-Svest (FYR Macedonia), Forum za slobodu odgoja (Croatia), Fractal (Serbia), Front 21/42 (FYR Macedonia), Green Home (Montenegro), MANS (Montenegro), CEE Bankwatch Network (regional), WWF (regional).