Building for failure: how the EIB’s €1.5bn loan uses public money to erode democracy, the environment and climate change targets.
On Tuesday, the European Investment Bank’s (EIB) board granted it’s biggest ever investment, a €1.5 billion loan for the Trans Adriatic Pipeline (TAP), the European leg of the Southern Gas Corridor. This contentious grant has been described as a direct transgression of democracy and climate justice. Katie Hodgetts dissects the what and the why to 2018’s most controversial decision…
If you listen carefully on a quiet day, you can hear the uniform gasps of future generations, as they watch from a distance the decisions unfold that are working to erode a fair and equitable future. This gasp, shared in real time by many of us, ricocheted through Europe at 17:50 (CET) Tuesday evening when the EIB approved a loan of €1.5 billion (£1.3 billion) of Europeans’ money to fund the polluting project, the TAP.
The TAP will be one part of the Southern Gas Corridor (SGC); a series of inter-connected gas pipelines which seek to pump 120 billion cubic meters of Caspian gas from Azerbaijan, across 6 countries to Europe. The TAP itself is a planned 870km long pipeline running from Greece to Italy, through Albania and the Adriatic Sea, making it just as ambitious as it is controversial.
The EIB have succeeded in simultaneously undermining science, the Paris Accord, and democracy, by granting a loan irrespective of last week’s report that the SGC could be as emissions-intensive as coal power, irrespective of widespread public resistance, and irrespective of the unceasing fruition of catastrophic climate change.
The TAP has faced significant public backlash over the years, stalling the loan at many stages. Last year, 4,000 e-mails from concerned citizens hampered EIB discussions and this year a viral campaign began to circulate with global citizens campaigning ‘not with my money’.
But beyond the keyboard, there has been resistance on the ground. In Italy, where 94 mayors have spoken out against the pipeline, TAP is said to impact water supplies. In Albania and Greece, the pipe will be built directly through farmland.
However, rather than diplomatic discussion, this resistance has been met with militarisation and strong repression, with one Italian community being put on military lock-down (http://www.independent.co.uk/news/world/europe/melendugno-trans-adriatic-pipeline-tap-red-zone-italy-protests-a8085586.html).
Within civil society, there is a deep feeling that TAP will seemingly traverse both Europe, and meaningful democracy.
Exacerbating climate change
The decision is at odds with the EU 2030 and 2050 energy and climate objectives. As Colin Roche, extractive industries campaigner for Friends of the Earth Europe argues, “the European Investment Bank is now shamelessly locking Europe into decades of fossil fuel dependency even as the window for fossil fuel use is slamming shut.
The Banks’s biggest ever investment in dangerous fossil fuels undermines the EU’s commitment to climate action when we urgently need to be transitioning to a fossil free future.”
This loan comes after a wave of scientific warning against gas, for example a report (http://www.foeeurope.org/NoRoomForGas) released late last year which concluded categorically that if the EU is to deliver a mitigation programme of 2ºC, then there can be no new gas infrastructure built, or other fossil fuels for that matter.
In short, gas is not a bridge to a clean energy future. It is a dead-end.
The significance of Russia
So why did the EIB grant such a contentious loan? The current line of the EU is ‘diversification of gas supply to meet future energy demands’, however questionably there lurk deeper political motives.
Russia currently provides 30% of EU’s natural gas, which has been a source of unease since the country historically halted its gas supply to Ukraine in 2014. Hence, the EU seeks to ensure its own energy security by diversifying its supply chain away from alleged authoritarian regimes. However, TAP will import gas from Azerbaijan, a country that has never had a free election and is marred by allegations of corruption and torture. On top of this, last year’s Azerbaijani Laundromat scandal exposed a $2.9bn fund that was used by Azerbaijan to curry influence, and pay lobbyists, apologists and European politicians. So if the EU wants to diversify its gas supply away from what they degree to be less stable regimes, then perhaps this TAP logic doesn’t quite add up?
Perhaps switching from Russian gas is in fact a geopolitical move to undermine Russian influence? Or perhaps it is profit that is the puppet master of diplomacy? Or perhaps, as always, the lines between the two become further blurred.
Gas begets gas
The building of the pipe indicates the high levels of gas supply that Europe predicts for the future. With increased supply, price signals change accordingly and gas becomes cheaper, in turn crowding out investment in gas’s future competitor: renewables. Gas is not a companion to a renewable energy future, it is competition.
The European Union now has €1.5 billion less to invest in renewable energy, pushing forward a decision that will lock us into a high-carbon future.
At the crux of TAP: enormous sums of public money are being used to fund a programme that will be detrimental the people and to planet, meaning that the EU is actively planning for failure.