Crossroads at Mmamabula: Will the World Bank Choose the Clean Energy Path?
AbstractAt the recent UN climate change conference in Bali, UN Secretary General Ban Ki-moon called for a revolutionary change in the world’s energy mix to minimize the risk of catastrophic global heating. This paper explores the implications for the World Bank and other donor institutions, employing proposed Bank financing of the Mmamabula coal-fired power project in Botswana as an illustrative case. Using the latest estimates of generating costs for coal-fired and low-carbon power options, I compute the CO2 accounting charges that would promote switching to the low-carbon options. In all cases, I find that that the switching charges are at the low end of the range that is compatible with safe atmospheric limits on carbon loading. Among the low-carbon options that I have considered for Botswana, solar thermal power seems to dominate carbon capture and storage. My results suggest that the World Bank and other donor institutions will adopt a transformational energy policy if they use appropriate accounting charges for carbon emissions. The Mmamabula example indicates that this approach will select low-carbon options in many cases, and grants from the Bank’s Clean Technology Fund and other sources can finance the market-cost gap between clean and fossil-fired technologies. Clean energy projects should proliferate, as donors learn about the new approach and more funds are devoted to meeting the global emissions reduction mandate.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Center for Global Development in its series Working Papers with number 140.
Length: 20 pages
Date of creation: Feb 2008
Date of revision:
Contact details of provider:
Web page: http://www.cgdev.org
World Bank; climate change; Botswana;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-05-05 (All new papers)
- NEP-ENE-2008-05-05 (Energy Economics)
- NEP-ENV-2008-05-05 (Environmental Economics)
You can help add them by filling out this form.
Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:CitEc Project, subscribe to its RSS feed for this item.
- Independent Evaluation Group, 2008. "Annual Review of Development Effectiveness 2008 : Shared Global Challenges," World Bank Publications, The World Bank, number 6553.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Roodman).
If references are entirely missing, you can add them using this form.