Dear Reader,

We wanted to let you know about our new study, published this week by the Center for Global Development and the Breakthrough Institute.

Climate finance at the World Bank is a hot topic, with major shareholders pushing for reforms that would have the Bank substantially expand its climate lending. But so far the discussion has focused much more on how much money the Bank can lend, rather than where that money is going.

With our colleague Guido Núñez-Mujica, we examined 2,554 projects between 2000 and 2022 that the World Bank includes in its climate portfolio, including 2,047 projects tagged specifically as climate mitigation. We found that the Bank has a climate portfolio skewed towards mitigation, both in middle-income countries and in energy-poor, low-income countries. 

We also found that hundreds of projects tagged climate—many in poorer countries—appear to have little to do with either climate change mitigation or adaptation, from teacher training to improving healthcare access for girls. $15 billion worth of the Bank’s climate finance portfolio is attributed to projects where climate accounts for less than 20 percent of the project’s value, and there typically is no climate rationale offered to support the climate tags in these cases. Further, most of the mitigation projects tagged as 100 percent climate lack estimates of greenhouse gas (GHG) emissions reductions, and there is no standardized reporting on GHG estimates across the portfolio.

What does this mean? It’s clear that reporting on climate programming at the Bank is still in its infancy. With immense pressure on the institution to scale up climate lending, it’s important that the Bank’s shareholders and climate advocates apply scrutiny to how the World Bank is spending its climate money, not just how it is raising it.

You can read the full paper here, and a shorter analysis of what we found here.