Investment chief warns against ideological policy for energy

The head of the European Bank for Reconstruction and Development (EBRD) has warned that the world cannot afford to be ideological when it comes to energy policy and says affordability and security of supply must be taken into account.

Riccardo Puliti told the Guardian that he was against “ideological” policy on carbon intensity in funding decisions without giving weight to other considerations, and hinted that his organisation would continue to fund coal-based power projects.
Riccardo Puliti of EBRD
His words carry some weight as he presides over one of Europe‘s most influential government-owned investors in the energy sector. It has a $48.6bn loan book, with 41 per cent of its investments last year channelled into the energy and infrastructure sectors.

“We strongly believe in a transition to a low-carbon economy and that is what we want to do as an active citizen. But other pillars need to be addressed,” he said.

“Affordability is a problem, even in developed countries, and security of supply is a problem. These pillars need to be addressed and analysed in a proper way so we find the best optimum solution. So I can’t say yes or no [to coal].”

Puliti said it was impossible to impose a one-size-fits-all policy. “The issue must be seen in the context of different countries. Energy is used not just for power but for heating too. A country like Mongolia has access to just one fuel ” coal ” although the EBRD has financed and is an investor in the first ever wind farm in Mongolia … You cannot be ideological about this.”

The EBRD has just provided $129m for a new lignite plant in Slovenia and will possibly finance coal generation in Kosovo and Serbia in the near future, despite the International Energy Agency’s calls for a phasing out of subsidies for fossil fuel-based power generation.

The bank is consulting with member countries at the moment as it seeks to formulate its energy investment policy in the coming months.

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