Through the Export-Import Bank, the Obama administration has spent nearly $34bn on dirty energy plants in countries from India to Australia to South Africa...

eemingly little connects a community in India plagued by toxic water, a looming air pollution crisis in South Africa and a new fracking boom that is pockmarking Australia. And yet there is a common thread: American taxpayer money.

Through the US Export-Import Bank, Barack Obama’s administration has spent nearly $34bn supporting 70 fossil fuel projects around the world, work by Columbia Journalism School’s Energy and Environment Reporting Project and the Guardian has revealed.

This unprecedented backing of oil, coal and gas projects is an unexpected footnote to Obama’s own climate change legacy. The president has called global warming “terrifying” and helped broker the world’s first proper agreement to tackle it, yet his administration has poured money into developments that will push the planet even closer to climate disaster.

For people living next to US-funded mines and power stations the impacts are even more starkly immediate.

Guardian and Columbia reporters have spent time at American-backed projects in India, South Africa and Australia to document the sickness, upheavals and environmental harm that come with huge dirty fuel developments.

In India, we heard complaints about coal ash blowing into villages, contaminated water and respiratory and stomach problems, all linked to a project that has had more than $650m in backing from the Obama administration.

In South Africa, another huge project is set to exacerbate existing air pollution problems, deforestation and water shortages. And in Australia, an enormous US-backed gas development is linked to a glut of fracking activity that has divided communities and brought a new wave of industrialization next to the cherished Great Barrier Reef.

While Obama can claim the US is the world’s leader on climate change – at least until Donald Trump enters the White House – it is also clear that it has become a major funder of fossil fuels that are having a serious impact upon people’s lives. This is the unexpected story of how Obama’s legacy is playing out overseas.

Sasan ultra mega power project, Madhya Pradesh, India

by Sonali Prasad

A hulking thermal power plant funded by American money shimmers in orange when night settles in India’s coal-rich district of Singrauli. A heavy blanket of smog wraps around the industrial district and its residents.

Sasan, an ambitious project by Indian energy utility Reliance Power, consumes coal incessantly from a nearby mine in the promise of lighting the homes of almost 300 million people in the country. But since it began operating in 2012, the project has been caught in a storm of health and safety violations, environmental concerns and land disputes.

In 2010, Sasan was handed a $650m export finance loan by the US Export-Import Bank (Ex-Im), a taxpayer-funded branch of the federal government that ostensibly exists to support American jobs and contribute to the US Treasury.

The Sasan project was initially rejected by the bank for financing because of the extremely high carbon emissions from the coal-powered plant. However, Reliance reapplied for the loan under tighter emission guidelines, promising to “offset” 26.4m tonnes of annual carbon dioxide emissions produced by the plant through renewable power projects.

Ex-Im Bank approved the loan to facilitate exports of goods and services from the US, insisting on environmental and safety guidelines for the plant’s sustainable development. However, over the course of five years, residents and activists in Singrauli concerns about the project have grown.

A villager living near the Sasan mine’s overburdened dumpsite pleads for relief and rehabilitation from the pollution hazards of the coal mine. Photograph: Sidharth M Vhavle for the Guardian

Ramakali, 30, dressed in a vibrant sari with a thick smear of vermillion on her forehead, bent over a murky green well that was brimming to the top. The towers of Reliance Power stood tall behind her, the lettering on the chimneys within sight of her mud-and-brick home in the village of Harrahawa. Flies and insects flitted in the well water. “The water has started to taste funny,” she said. “I have been struggling with strong pains in my stomach ever since they started dumping their trash into our groundwater.”

She pointed to the residual ash dumpsite of the Sasan plant, which is only a couple of metres from her doorstep. On a hot day, one can see ash dust blowing up from the ash pond in the direction of nearby villages surrounding the plant.

The locals complain that ash from the enclosed reservoir is settling into the surface water of nearby regions, causing the wells to fill up to the top with impure water. “We put in a request for a handpump to the company but we never heard back,” Ramakali said, shaking her head. “They do nothing. We have complained countless number of times.”

The national green tribunal, a court that hears environmental cases in India, released a report by a committee of environmental experts in August 2015, stating that the groundwater in Harrahawa next to the plant had high levels of mercury in it. Excess mercury in drinking water has been medically linked to severe nervous disorders and birth defects.

Sasan was not exclusively identified as a source of contamination in the report, but the experts are certain that it’s linked to Sasan and the other big thermal plants in the region.


(I wonder what his buddy Leo would think about all of this...)

Obama’s complicated legacy on climate change

Two other government agencies determined Sasan’s mining waste was illegally overflowing into surrounding forest and farmlands, and that the company had failed to restore the green space lost due to the plant’s construction. Toxic coal dust was also found to have settled in the fields located next to the mines.

The Singrauli industrial cluster has been dotted with several giant thermal plants and coalmines since the 1980s, Sasan being the most recent addition to the country’s coal hub. In January 2010, the Indian ministry of environment and forests declared Singrauli a critically polluted area.

“When Reliance was planning to set up a plant in Singrauli, they knew that area already had severe poisoning and massive industrial pollution issues,” said Ashwani Kumar Dubey, a lawyer who has repeatedly taken on the coal industry. “Yet, they went ahead and set up their plant. They are adding to the damage, and not doing anything to control it.”

Reliance’s coalmine at Moher and its dumpsite are only a short distance away from the thermal power plant. The coal is transported into the power plant through a 14km long, blue, snake-like conveyor belt, saving Reliance Power the overhead costs of railroad transportation.

Devnarayan Sahu, 40, lives with his family and a herd of cattle in a village cluster called Amlohri, within 50 metres of Sasan’s overflowing dumpsite. The thud of mine blasting echoes in the background and Narayan’s house quivers a little. “We’ve become used to the tremors,” he said.

The 14km-long blue conveyor belt that transports coal to the power plant. Photograph: Sidharth M Vhavle for the Guardian

Narayan walked over to his backyard, and pointed to the bulldozers dropping boulders from atop the mounds of toxic mining waste. “Look at how those stones are rolling into my farm and home,” he said. “When it rained a couple of days ago, we were flooded with their rubble.”

A layer of grey coal dust has settled on his impoverished eggplant and tomato farm, his main source of livelihood. “If I don’t water them continuously to get rid of the toxic dust, the crop will not flower,” he said, wiping off dust from a pod with his fingers.

The industrial pollution is taking a toll on Narayan and his family. Difficulties in breathing, stomach aches and joint pains are common. “When we cough in the morning, we see dust in our sputum,” he said. “The little that we earn is now going into medical treatments.”

“Asthma, allergies and bronchitis are prevalent here because of the air pollution, especially in children belonging to clusters around the ash dams, mines and thermal power plants,” said Dr Kalpana Ravi, a paediatrician at the local district hospital in Waidhan.


Narayan has been pleading with Reliance to remedy the situation for years, but nothing has happened. “Many officials have come and inspected the place,” he said. “They come and go, but do nothing. Reliance says they don’t need our land as of yet. We can see the big boulders falling. Like many others who have abandoned their homes for the fear of their lives, they want us also to eventually get scared and move away on our own.”


Families settled almost directly underneath the noisy conveyor belt that brings coal to the plant have a similar tale to tell.

“I don’t know what will happen sooner: will we go deaf first due to the constant and unbearable rattling over our rooftops, or will we choke on the coal dust falling from the belt,” said Sukhlal Panika, who lives under a section of the conveyor belt with his aged mother. Reliance only acquired a part of his farmland for the belt, leaving his house and well exposed to the pollution caused by coal transportation.

Impoverished villagers of Harrahawa and Siddhikhurd living in close proximity in to the Sasan power plant complain of polluted air and toxic well water. Photograph: Sidharth M Vhavle for the Guardian

 Sasan has also been hit by reports of accidents, harassment, fatalities and injuries. In February 2015, Ex-Im’s chairman, Fred Hochberg, criticized the “poor” safety practices at the Sasan project in a letter to Reliance.

Hochberg stated: “the number of all fatalities at the integrated Project is now 19 – which is both tragic and absolutely unacceptable.” The chairman’s letter said “the alarming number of injuries and fatalities must come to an end” and that “rather than improving, the situation appears to be deteriorating”.


The police confirmed that 16 cases relating to the Sasan plant and coalmine have been investigated since 2012, resulting from vehicle accidents, beam and tower deaths and electric shocks.

Activist Awadhesh Kumar, who has been speaking to workers in Sasan and surrounding villages, believes the real number is larger. “It’s harder to account for the migrant workers who have no family here, and they form a huge chunk of Sasan’s labour population. When something happens or someone goes missing, there is no one to question the company for a report or explanation.”


In response to Ex-Im’s letter regarding the incidents, Sasan provided the bank with information on a taskforce comprising middle managers for the purpose of improving safety and training.


But the steps taken by Ex-Im to regulate Sasan are too little too late, according to people living around the thermal power plant and the coalmine. “Ex-Im’s ground inspection should have been done a long time back, and that too on a regular basis,” said Kumar.

“A federal agency of the United States of America should hold their financed projects to better and more neutral standards. Development is good, but not at the cost of the environment and the people who give away their everything to make way for such projects.”

All points in the story have been raised with Reliance officials. They are yet to comment.

Liquified natural gas plants, Queensland, Australia

by Michael Slezak

Alan and Ailsa Smith say setting foot on Curtis Island is like stepping back in history. The world-heritage-listed tropical island where they live sits just off the coast of Gladstone in Queensland, Australia, right under the Tropic of Capricorn.

“It’s a quiet little community here. You slip back 25 years in time,” said Alan.

The couple own a small grocery store and bed-and-breakfast. It’s the only business in the only village on the island, which is home to just 30 permanent residents.

But South End has a new neighbour that makes itself known at night, illuminating the clouds with its startlingly bright lights, and occasionally sending flames into the sky.

Since 2010, amid a storm of controversy that extended from Australia to the US, Curtis Island’s 30 residents have been joined by three giant gas liquefaction plants, with a fourth on the way.

Ailsa and Alan Smith the owners of Capricorn Lodge, the only business on Curtis Island apart from the LNG plants. Photograph: Matthew Abbott for the Guardian

When complete, they will propel Australia to become the world’s biggest exporter of liquefied natural gas (LNG), overtaking Qatar. Their development has allowed a controversial fracking boom in Queensland, where about 6,000 coal seam gas wells have been drilled to deliver gas to be liquefied at the plants.

Two of the three plants – APLNG and QCLNG – have been backed by a $4.7bn loan from the US Export-Import Bank. Once operational, these developments will produce about 11.3m tonnes of carbon dioxide each year – and this figure will be much higher if methane emissions that leak from the wells aren’t controlled.


Those estimates ignore the carbon emissions that will be produced when the gas exported from Curtis Island is burned. The two US-funded plants will produce up to 17.5m tonnes of liquid natural gas each year. When burned, that will pump about 50m tonnes of CO2 into the atmosphere – roughly equivalent to the annual output of Sweden.


Sitting and having a beer at Capricorn Lodge, another of the island’s residents, Michael Radcliffe, says he isn’t bothered by the LNG plants, but expressed some concern about smoke produced when the plants burn some of their gases in large flares.

“There’s a lot of black stuff that comes out,” Radcliffe said. A week earlier there were a lot of flares that produced a lot of black smoke, he said. “I thought there was a bushfire or something going on.”

Glimpses of the LNG Plants can be seen through the dense bush. Locals from South End community occasionally hold ‘Flare Parties’, sitting on their four wheel drives, watching the plants burn off excess gas. Photograph: Matthew Abbott for the Guardian

From the top of Ship Hill, it’s clear why the locals are interested to see the plants at sundown. As the sun sets, thousands of lights on the gas plants light up. The bushland between the hill and the plants is thick, but through the trees the sight of the huge plants – and the contrast they make with the rest of the island – is astounding.

The plants produce a loud hum, a bit like the sound of a giant refrigerator – which is almost exactly what an LNG plant is.

 To allow ships to dock to collect the liquified gas, the Queensland government conducted a huge dredging operation in the harbour.

Around 25m cubic metres of earth have been scooped up from the harbour floor, with the Australian government giving approval for a further 19m cubic meters to be dug up. Some was simply dumped in the Coral Sea and the rest was put behind an 8km “bund wall” and used to reclaim land right opposite Curtis Island – a measure intended to stop the dredge spoil from smothering the delicate ecosystems of the Great Barrier Reef.

The wall failed, the dredge spoil leaked through it, and spread through the Great Barrier Reef world heritage area.

Satellite analysis showed the plumes of mud that spread through the water stretched for 35km into the Coral Sea, which would have degraded seagrass meadows that support endangered dugongs.

As the dredging started, fishermen reported an outbreak of disease among marine life, which scientists said could have been caused by metals on the seafloor that were released into the water.

In an unusually forthright step, the International Union for Conservation of Nature, which advises the UN’s world heritage committee on scientific matters, called for the LNG developments to be halted.

Trevor Falzon used to catch fish in Gladstone Harbour, home to one of the largest ports in the world. He was the lead plaintiff in an unsuccessful case brought by 51 fishermen against the Gladstone Ports Corporation over the dredging.

The development meant they lost an area that they used to fish in. And the dredging meant the nets they used in shallow water weren’t suitable in the new deep water, but the case was thrown out.

“Now I have to sell everything – my house is on the market,” Falzon said, sitting among packing boxes in his house on the outskirts of Gladstone.


Kusile power station, Mpumalanga, South Africa

by Jason Burke

As the sun dips across the rolling hills of South Africa’s eastern Mpumalanga province the lights come on high above the valley’s wetlands, soaring columns and cranes, black against the reddening sky.

The vast structure on the ridge is clearly visible from the small settlement of Arbor, a huddle of shacks and huts on a narrow strip of land between a coalmine and railway sidings 10 kilometres from Kusile.

“I watch it growing and I wonder what it will bring. It might mean jobs and development, or maybe sickness and drought. I don’t know. So I hope and pray it will make things better, not worse,” said Sibongile Sibeko, 41, a mother of five children in Arbor.

The structure Sibeko can see is what has so far been built of Kusile, which will be among the 10 biggest coal-fired power stations in the world, and is already one of the most controversial.

The project is part-funded by the US government, having received a loan of $805m from the US Export-Import Bank in 2011 after Eskom chose a US company to play a key engineering role, creating hundreds of jobs for American specialists. The money was crucial to the $8.4bn project, say campaigners.

A man drives cattle near the Kendal power station in Mpumalanga province, South Africa. Photograph: James Oatway for the Guardian

“Kusile would have been very challenging to proceed with if the money from the Export-Import Bank had not come through,” said Melita Steele of Greenpeace.

Delayed by decades and wildly over budget, Kusile is emblematic of a development model increasingly seen as outdated. The days of vast mega-projects with enormous financial, social and environmental costs, as well as the potential to transform economies, are over, some experts say. Instead, smaller and cheaper projects can bring change as effectively, supplying energy and other needs with minimal impact.

“The only hope for us is renewable energy. That would mean less destruction, less landgrabbing or none at all and no need for coal and water,” said Matthews Hlabane, of the South African Green Revolutionary Council, a local NGO.

But the loan was also very expensive. As local currency has lost value against the dollar the cost of repayments has soared.

The project is immense. When completed Kusile will consist of six units with the ability to generate 4,800MW, making it significantly bigger than any power station in the US except the hydroelectric Grand Coulee dam in Washington.

Defenders say Kusile has been designed with advanced technology that will minimise its environmental impact, such as scrubbers to control sulphur dioxide and filters to reduce emissions of dangerous particulates. The plant will use an air cooling system to help conserve water and is designed so equipment to capture carbon emissions can be fitted in the future.

The plan to build Kusile, and its twin Medupi, in Limpopo province, dates back to the immediate aftermath of the repressive racist apartheid regime. Conceived as energy providers for a growing and free nation, they were seen as powerful statements of a new commitment to a modern economy that would improve the lives of all South Africa’s citizens. Kusile means “New Dawn” in Zulu, a local language.

In recent years, South Africa has been hit by severe power shortages, leading to rolling outages. Though these have now eased, in part due to renewable energy sources supplementing supply, local officials say that Kusile is still essential to ensure the developing nation’s energy security for decades to come.

Sibongile Sibeko with her children Linda, four, left, and Jabulile, eight, right. The Sibeko family live on the edge of the coal mine in Arbor. Photograph: James Oatway for the Guardian

But circumstances – and attitudes – have changed since the original decision was taken to build the vast plants.

“Medupi and Kusile are examples of large-scale mega infrastructure projects that countries see as the basis of a development model that started after World War II. Projects this large are seen as transformational. They cost a lot. They employ a lot of people. Their effects are meant to be big. But it’s a model that doesn’t make much sense now,” Janet Redman, director of the climate programme at the Institute for Policy Studies in Washington DC said earlier this year.

“Using coal for energy is hugely expensive, outdated, against international trends and is financially and environmental irresponsible,” said Robyn Hugo of the Centre for Environmental Rights, a local NGO.

According to one estimate the total cost of the twin projects of Kusile and Medupi could eventually top $32bn. Medupi relies in part on a $500m loan from the African Development Bank and also $3bn from the World Bank, approved in 2010. Both projects have been plagued by allegations of corruption. All concerned deny any wrongdoing.

Kusile alone is projected to emit an estimated 36.8m tonnes of CO2-equivalent, according to Eskom’s own estimates. With Medupi, it will add 16% to South Africa’s current CO2 emission levels.

The impact on local towns and villages will be immense. It is not simply the power station itself, and the air pollution and traffic it will generate, but the vast coalmining operations needed to provide the estimated 17m tonnes of coal Kusile will require each year.

Farmland and wetlands will disappear as new open-cast and underground mines are opened or, in some cases, reopened. Tens of thousands of impoverished labourers will swell some settlements. Others will have to be entirely shifted to new locations. Roads will be built, bringing access and jobs for some, but exacerbating environmental consequences.

This is far from pristine farmland or wilderness, however. Central Mpumalanga is the site of a dozen power stations and a huge mining industry.

Eleriza Van Rooyen and her daughter Thandeka, aged nine months, can see Kusile power station from their new house. The family was relocated to make way for Kusile. Photograph: James Oatway for the Guardian

One of the major complaints of local communities is that local men are rarely hired by companies for anything but casual labour because already acute air pollution has, they claim, damaged their lungs.

Mpumalanga is already designated as a zone of acute air pollution in South Africa. Locals complain of sinus infections, headaches and coughing children.

Sibongile Sibeko, who has lived in the community of Arbor all her life said her three daughters and two sons had all suffered respiratory illnesses which local doctors blamed on “dust”.

She lives in a small three-roomed hut only a few metres from waste spoil marking the boundary of a major mine, operational for around five years. The Kendal power station, Africa’s biggest, is close by. It has been operational since the early 1980s, is coal-fired and has a capacity of more than 4,000MW.

“The doctor saw my little one – my four-year-old – recently. He said his chest was closing because of the dust,” Sibeko said.

Then there is water. Among the impacts of Kusile will be the destruction of important wetlands around the plant. Massive infrastructure including pipelines and canals has been constructed to bring water for cooling to Kusile, but the plans were conceived in a period when water was more plentiful. South Africa is currently experiencing its worst drought for 50 years, which some blame on climate change.

In all villages around Kusile, there are complaints of lack of water, deforestation and other environmental and social problems, ranging from higher crime levels to overcrowded schools, linked to the influx of workers.

“Before the mine came we had wood from forests and water from boreholes, and we grew vegetables in small gardens. We had goats, cows and chickens and there was a white farmer and people here worked on his land. But there are no jobs in farming now and there is no forest and the boreholes are dry or the water is bad, and there is no space for livestock or even our gardens because of all the people who have come,” Sibeko said.

Another nearby village, cut off from the main highway by a strip of dry grass strewn with cider bottles and rusting cans, is often shaken by the blasting at the nearby mine.

“There is a lot of dust here, especially when they are blasting,” said Patricia Mabaso, 30. “The old people and the children get diseases from it. Once it was all green round here, now it’s a desert.”

The Energy and Environmental Reporting Project is supported by the Blanchette Hooker Rockefeller Fund, Energy Foundation, Open Society Foundations, Rockefeller Brothers Fund, Rockefeller Family Fund, Lorana Sullivan Foundation and the Tellus Mater Foundation. The funders have no involvement in or influence over the articles produced by project fellows in collaboration with The Guardian.

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