The finance ministers of the world convened in Washington for the annual meeting of the World Bank. Their goal: high risk/high reward mega-infrastructure projects (big dams, power plants, pipelines, grids, etc.). The two big questions: aren’t there better approaches to infrastructure today? And won’t the ministers’ plans put a sustainable economy further out of reach? The happy answer to the first question is “yes,” but “yes” is also the sad answer to the second question.
The World Bank’s plan to build such gigantic projects contradicts its stated objective to end poverty. This plan resurrects nightmarish approaches that have increased poverty, disempowered women, devastated life-sustaining ecosystems, and created massive debt burdens.
That is why International Rivers, Amazon Watch, and many other groups gathered outside the World Bank on October 12th to protest the plan for high risk/high reward projects and promote “Power 4 People.” In a true-cost economy the objective for infrastructure would be low risk/high reward projects. Such an economy would avoid casino-style investments and embrace infrastructure that leapfrogs the costly, destructive, and outdated approaches favored by the World Bank.
Despite serious mining and health issues, construction of cell phone infrastructure has been more environmentally sound than the old standard of installing high-cost telephone lines in remote areas. Today over 400 million people have cell phones but lack access to electricity. Taking a cue from the cell phone revolution, there’s an opportunity to construct a low risk/high reward energy infrastructure consisting of dispersed solar and wind projects. These renewable technologies can reduce the need for long and expensive transmission lines, and they don’t require water to generate electricity. Furthermore, with the cost of rooftop panels having rapidly dropped, solar energy has clear cost advantages for supplying electricity to rural communities.
In Africa about 600 million people lack access to electricity, and most are unlikely to be served by the dams and coal power plants proposed by the world powers because the transmission lines from central power stations would cost too much. That’s why the International Energy Agency reports that 70% of the world’s un-electrified areas are best served through mini-grids or off-grid solutions.
The advantages of a dispersed energy infrastructure include ability to reach the poor, reduced cost, less risk, and fewer socially and environmentally harmful impacts. Bangladesh, where something like 35,000 rooftop solar systems are being installed each month, is demonstrating these advantages.
The release of Bruce Rich’s book, Foreclosing the Future, comes at a critical moment, for it provides an insightful, well-written history of the World Bank’s inability Bank to learn from its past failures. Rich exposes the shocking first year of Jim Yong Kim’s term as Bank President, even though Kim came to the job with knowledge of the harmful impacts of past Bank projects.