As a result of public resistance to small-scale hydropower projects in the Balkans, and in consequence to the milestone bank summit between the financial sector and green activists on March 1st, the European Bank for Reconstruction and Development (EBRD) is considerably tightening its standards: according to its new Environmental and Social Policy, the bank will ask commercial banks to refer all high-risk projects – including all hydropower plants – for additional checks, starting with 2020. The EBRD also requires them to meet higher environmental standards than previously and is making projects within areas of high biodiversity financially non-viable. In addition, the bank will ask that such projects are disclosed to the public on the financial intermediary’s website, finally increasing transparency on these hitherto hidden projects. The bank has also developed a guidance note on small-hydropower projects that clarifies its requirements for direct financing as well as intermediated lending.
This is a major breakthrough as these new guidelines will make commercial banks think twice before financing destructive hydropower projects with EBRD money. Great news for free rivers and a major win in the Blue Heart campaign.