The indispensable Inter Press Service flagged a 79-page report last month detailing how the World Bank--after years of costly boondoggles and declining prestige within the save-the-world industry--has hit a new low: "Making money off of causing the climate crisis and then turning around and claiming to solve it." This according to Janet Redman, the study's lead author at the Institute for Policy Studies. The paper asserts that, rather than encouraging clean energy investors (as its new, legitimacy-craving climate proposals had announced), the bank is dropping almost 80 percent of its $2 billion carbon finance portfolio into the coffers of fossil fuel producers. In just over two years, the bank loaned about $1.5 billion to oil, coal and gas companies. And less than ten percent of the money doled out to date was headed to wind, solar, geothermal and other renewables.

Worse, the offsets for sale appear not to be very valuable (to environmentalists): Of the 83 active World Bank projects found in the online project database, only nine have delivered Certified Emissions Reductions. As the de facto rule-maker for global carbon trade, the World Bank was also able to use various developing world sites as incubators for experimental offsetting technologies, sometimes at the cost of human or natural prosperity. Deborah Wyndam, another researcher, describes the shell game as follows:

The bank finances a fossil fuel project in Poor Country A. Rich Country B asks the bank to help arrange carbon credits so Country B can tell its carbon counters it's taking serious action on climate change… It kindly obliges, offering credits for a price far lower than Country B would have to pay if Country B made those cuts at home…Country A gets a share of the cash to invest in equipment to make the fossil fuel project slightly more efficient…. The bank takes its 13 percent cut, and everyone is happy.

Sheesh. Just the fact that "regular" World Bank finances are going toward polluting industries to begin with begs outcry. Why not make the changes there? If the bank is so committed, start throwing up wind farms in Western Sahara! I'm not skilled enough at microfinance (the developing world projects may, in their specifics, be worthwhile--and companies are at least aware of the need to appear to be attempting to greenwash) to recommend a bold new strategy. But this profiteering cannot persist. Is the solution less free-market NGO work (leave the capping and trading to nations), or more quotas (50 percent, say, for renewables) or other checks on the support the World Bank can offer environmentalists?

--Dayo Olopade