Fossilized Thinking: The World Bank, Eskom, and the Real Cost of Coal

This report analyzes a 3.75 billion dollar World Bank loan to Eskom Holding Limited for an energy project in South Africa, arguing that the Bank's economic evaluation failed to account for environmental externalities and social costs, potentially leading to a systemic over-investment in large-scale centralized power projects.

• In early 2010, the World Bank Group approved a 3.75 billion dollar loan to Eskom Holding Limited to fund the Eskom Investment Support Project in South Africa. This project included a 4,800 MW coal-fired power plant, investments in solar and wind renewable energies, and a low carbon rail project.
• The report asserts that the World Bank failed to comply with Bank Operational Policy 10.04 (OP 10.04) by neglecting to fully consider environmental externalities in the Economic Evaluation for the Eskom project. This omission is described as making the evaluation incomplete and inaccurate, which distorted the approval process.
• The analysis suggests a broader pattern where the failure to quantify environmental and social costs leads to a tendency to favor and over-invest in large-scale centralized power projects, including coal, oil, gas, nuclear, and large hydro, while overstating their benefits.

APA

Amerasinghe, & Porter (2011). Fossilized Thinking: The World Bank, Eskom, and the Real Cost of Coal. Center for International Environmental Law. https://www.ciel.org/reports/fossilized-thinking-the-world-bank-eskom-and-the-real-cost-of-coal-amerasinghe-porter-march-2011analysis-of-the-world-bank-eskom-loan-to-fund-a-large-energy-project-in-south-africa-and-how-t/

Chicago

Amerasinghe, and Porter. Fossilized Thinking: The World Bank, Eskom, and the Real Cost of Coal. Center for International Environmental Law, 2011. https://www.ciel.org/reports/fossilized-thinking-the-world-bank-eskom-and-the-real-cost-of-coal-amerasinghe-porter-march-2011analysis-of-the-world-bank-eskom-loan-to-fund-a-large-energy-project-in-south-africa-and-how-t/.

Wikipedia

{{cite report |last1=Amerasinghe |last2=Porter |title=Fossilized Thinking: The World Bank, Eskom, and the Real Cost of Coal |publisher=Center for International Environmental Law |date=1 March 2011 |url=https://www.ciel.org/reports/fossilized-thinking-the-world-bank-eskom-and-the-real-cost-of-coal-amerasinghe-porter-march-2011analysis-of-the-world-bank-eskom-loan-to-fund-a-large-energy-project-in-south-africa-and-how-t/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{amerasinghe2011fossilized, author = {Amerasinghe and Porter}, title = {{Fossilized Thinking: The World Bank, Eskom, and the Real Cost of Coal}}, institution = {Center for International Environmental Law}, year = {2011}, month = mar, url = {https://www.ciel.org/reports/fossilized-thinking-the-world-bank-eskom-and-the-real-cost-of-coal-amerasinghe-porter-march-2011analysis-of-the-world-bank-eskom-loan-to-fund-a-large-energy-project-in-south-africa-and-how-t/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }