EBRD pulls out from oil investment

The European Bank for Reconstruction & Development (EBRD) will stop funding upstream oil exploration. And it will not finance upstream oil development projects, except in exceptional circumstances where projects reduce greenhouse gas emissions, writes Keith Nuthall.

The commitments come in a new energy strategy for 2019–2023, under which the Bank says it will continue to support the natural gas sector, where new plans and infrastructure help countries switch from more carbon-intensive fuels, such as coal and oil. Under the new guidelines, for any EBRD projects to fund natural gas installations, they must not lead to any reduction in usage of renewable energy systems.

The Bank supports a range of development projects, for the most part in eastern Europe and central Asia. It is currently only supporting existing projects in Russia, not developing new investments there.

An EBRD note says the new energy strategy will involve ‘scaling-up of investment in renewables, supporting the integration of energy systems, promoting the switch to cleaner and more resilient energy sources and facilitating electrification…’ This will ‘clean the economies where the Bank invests, which include some of the least energy-efficient and most polluting economies and cities in the world.’

The strategy highlights some innovations likely to attract EBRD support over the next five years, such as installing methane emissions detection systems, battery storage, waste-to-fuels and power technology, and more.