FOSSILIZED THINKING

The report examines the World Bank's 3.75 billion dollar loan to Eskom for the Medupi coal-fired power plant, asserting that the Bank's Economic Analysis ignored critical environmental and social costs. It highlights failures to assess transboundary impacts on Botswana, Zimbabwe, and Mozambique, as well as domestic risks regarding water scarcity, water quality, and air pollution. The authors argue that this pattern of under-valuing externalities leads to over-investment in large-scale centralized fossil fuel projects at the expense of decentralized renewables.

• The World Bank's Economic Analysis for the Eskom project failed to meet the requirements of Operational Policy 10.04 (OP 10.04) by not fully quantifying environmental and social costs, which the report claims resulted in a "drastically skewed and overly positive present net value assessment of the project."
• The report identifies a significant gap in the analysis regarding transboundary impacts, noting that the Medupi plant is located less than 30 miles from the Botswana border and relies on tributaries of the Limpopo River, yet the study areas for the Environmental Impact Assessment (EIA) were "limited to South Africa."
• Water scarcity is a critical concern as the Medupi plant requires approximately 12 million m3 of water per year when using wet flue gas desulphurization (FGD) to abate SO2 emissions. The report argues the Bank failed to consider the "opportunity costs involved in reallocating the water" in a region where the Mokolo Dam's water is already fully allocated.
• The analysis omits the economic costs of water quality degradation, including risks from "potently toxic coal ash and waste water," acid mine drainage, and the impacts of sand mining during construction.
• The World Bank failed to include health costs associated with air pollution in its Economic Analysis, despite the plant's location in a "hot zone" for air pollution and the known risks of SO2 and particulate matter to the 100,000 residents of the Lephalale Local Municipality.
• The report challenges the Bank's claim that net GHG emissions from Medupi would be lower than its gross 30 million tons per year because it would replace emissions-intensive sources like kerosene. The authors argue this "assumes that the energy produced by the Medupi plant is certain to reach those who use candles and other self-generated sources," which is not guaranteed due to affordability and access issues.

APA

Amerasinghe, N., & Porter, S. (2011). FOSSILIZED THINKING. Center for International Environmental Law. https://www.ciel.org/wp-content/uploads/2014/11/FossilThinking_Eskom_21Mar11.pdf

Chicago

Amerasinghe, Niranjali, and Stephen Porter. FOSSILIZED THINKING. Center for International Environmental Law, 2011. https://www.ciel.org/wp-content/uploads/2014/11/FossilThinking_Eskom_21Mar11.pdf.

Wikipedia

{{cite report |last1=Amerasinghe |first1=Niranjali |last2=Porter |first2=Stephen |title=FOSSILIZED THINKING |publisher=Center for International Environmental Law |date=March 2011 |url=https://www.ciel.org/wp-content/uploads/2014/11/FossilThinking_Eskom_21Mar11.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{amerasinghe2011fossilized, author = {Amerasinghe, Niranjali and Porter, Stephen}, title = {{FOSSILIZED THINKING}}, institution = {Center for International Environmental Law}, year = {2011}, month = mar, url = {https://www.ciel.org/wp-content/uploads/2014/11/FossilThinking_Eskom_21Mar11.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }