UK climate aid funds electricity for Walmart in Mexico

UK climate aid funds electricity for Walmart in Mexico

Date: 2 December 2011

A report launched today by the World Development Movement reveals that UK climate aid is being used to produce cheap electricity for the US multinational Walmart, through a project that violates the rights of indigenous people in Mexico.

The report, ‘Power to the people?’, details how money taken from the UK aid budget has been used by the World Bank to finance wind farms in the Mexican state of Oaxaca, built without the consent of the indigenous people who own the land. The project produces enough electricity to power 160,000 homes, but is instead being sold at a discounted rate to Walmart. The project is 99 per cent controlled by French electricity giant EDF.

The La Mata and La Ventosa wind park is part funded the World Bank’s Clean Technology Fund, which receives 14 per cent of its money – or £385 million – from the UK overseas aid budget. The fund’s objectives include poverty reduction, but the wind park has done nothing to increase energy access among the seven per cent of Oaxaca’s population who have no electricity.

Local indigenous woman Bettina Cruz Velazquez told the World Development Movement:

With the pretext of advancing renewable energy, big corporations are occupying our land with windmills. Agriculture, particularly corn plantations, is the essence of our region, and will be completely displaced by the wind farm projects. The companies come and they say, yes, we consulted, but here there has not been any consultation.“

The report launch coincides with the UN climate talks currently underway in Durban, South Africa, where a new global ‘Green Climate Fund’, intended to replace temporary arrangements such the Clean Technology Fund, is expected to be agreed. The World Development Movement and 162 other organisations are calling for the new fund to prioritise projects that tackle poverty and aid transition to a low carbon economy, rather than financing multinationals through a proposed dedicated private sector arm.

The World Development Movement’s policy officer Murray Worthy said today:

Developing countries urgently need finance to help them transition to a low carbon economy, but projects like the La Mata and La Ventosa wind park show the dangers of throwing public finance at multinational companies like EDF and Walmart. The park violates indigenous land rights, does nothing to increase energy access, and does little to help reduce Mexico’s carbon emissions since fossil fuel power development is still set to outstrip growth in wind capacity. Projects like this do not need and should not receive aid money – yet developed countries are pushing for the new climate fund to have an arm dedicated to funding this kind of development disaster.”

Read the report

Read the World Development Movement’s media briefing on the Durban talks

For more information please contact:

Miriam Ross in London on (+44) (0)20 7820 4913 or (+44) (0)7711 875 345 or email [email protected]

Murray Worthy in Durban on (+27) (0)83 968 9917