How the European Bank for Reconstruction and Development Can Shift Millions From Fossil Fuels to Clean Energy Through the Glasgow Commitment

This policy brief by the International Institute for Sustainable Development (IISD) argues that the European Bank for Reconstruction and Development (EBRD) should sign the Glasgow Statement on International Public Support for the Clean Energy Transition. The authors suggest that by redirecting its average annual fossil fuel investments of EUR 741 million toward clean energy, the EBRD could increase its annual clean energy financing by 50%. The brief recommends that the EBRD implement a robust fossil fuel exclusion policy, specifically targeting gas infrastructure, to align with the 1.5°C warming limit of the Paris Agreement.

• The EBRD has a significant opportunity to increase its clean energy funding by redirecting its fossil fuel investments. Between 2018 and 2021, the Bank invested an average of EUR 1.4 billion annually in clean energy and EUR 741 million annually in fossil fuel energy. Redirecting these fossil fuel funds would increase annual clean energy financing by 50%, raising it to EUR 2.1 billion on average per year.
• The EBRD's current Energy Sector Strategy (ESS) is not fully aligned with the Glasgow Statement because it lacks exclusions for upstream gas and midstream and downstream oil and gas investment, although it already excludes thermal coal mining, coal-fired power plants, and most upstream oil exploration and production.
• The brief argues against the use of natural gas as a transition fuel, citing its climate impact, methane leaks, and the availability of cost-competitive clean alternatives. It asserts that gas infrastructure risks creating stranded assets and undermines development priorities, as seen in Tunisia, where high fuel import costs contributed to a credit rating downgrade to "CCC" by Fitch.
• To align with the Glasgow Statement, the EBRD could adopt a 'blanket exclusion' policy, which excludes all support for gas projects including gas-fired power. Examples of such policies are found at Swedfund and the Agence Francaise de Développement (AFD), though the AFD allows narrow exceptions for domestic gas distribution for heating and cooking, hybrid mini-grids, and the decommissioning of existing infrastructure.
• Alternatively, the EBRD could implement limited exemptions for gas power generation based on strict screening criteria. These criteria could include geographic restrictions (e.g., limiting investment to least developed countries or sub-Saharan low-income countries), risk assessments for lock-in and stranded assets, evaluations of renewable alternatives, and the inclusion of a sunset clause to end support by a specific date.
• The brief warns that 'abated' fossil fuels—those using carbon capture and storage (CCS)—are not a highly effective tool for 1.5°C alignment due to high costs and technological limitations. It recommends that any exceptions for abated fuels be limited to gas-fired power fully equipped with proven CCS, excluding 'CCS-ready' plants or those used for enhanced oil or gas recovery.
• The authors provide five specific recommendations for the EBRD: sign the Glasgow Statement by COP 27; implement a robust fossil fuel exclusion policy for the entire value chain; design exceptions that prevent fossil fuel lock-in; apply exclusions to indirect support (such as financial intermediaries); and develop strategies to shift finance toward clean energy and the private sector, prioritizing grant-based or concessional instruments.

APA

Jones, N., & Madereel, E. (2022). How the European Bank for Reconstruction and Development Can Shift Millions From Fossil Fuels to Clean Energy Through the Glasgow Commitment. International Institute for Sustainable Development. https://www.iisd.org/system/files/2022-10/ebrd-shift-fossil-fuels-clean-energy.pdf

Chicago

Jones, Natalie, and Enrique Madereel. How the European Bank for Reconstruction and Development Can Shift Millions From Fossil Fuels to Clean Energy Through the Glasgow Commitment. International Institute for Sustainable Development, 2022. https://www.iisd.org/system/files/2022-10/ebrd-shift-fossil-fuels-clean-energy.pdf.

Wikipedia

{{cite report |last1=Jones |first1=Natalie |last2=Madereel |first2=Enrique |title=How the European Bank for Reconstruction and Development Can Shift Millions From Fossil Fuels to Clean Energy Through the Glasgow Commitment |publisher=International Institute for Sustainable Development |date=October 2022 |url=https://www.iisd.org/system/files/2022-10/ebrd-shift-fossil-fuels-clean-energy.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{jones2022how, author = {Jones, Natalie and Madereel, Enrique}, title = {{How the European Bank for Reconstruction and Development Can Shift Millions From Fossil Fuels to Clean Energy Through the Glasgow Commitment}}, institution = {International Institute for Sustainable Development}, year = {2022}, month = oct, url = {https://www.iisd.org/system/files/2022-10/ebrd-shift-fossil-fuels-clean-energy.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }