AT THE END of its long march from the fringe to the mainstream, the international environmental movement confronts a challenge. Now that the world has accepted the basic message that the envi- ronment matters, campaigners have to move beyond denouncing everything that has an environmental cost; they have a duty to say which costs are most serious and how the expense of mitigating them should be apportioned. The difficulty of rising to this challenge is illustrated by the fractious rela- tionship between the environmental movement and the World Bank. The most recent clash between the two sides -- centering on the bank's lending to extractive industries, especially oil -- shows that some environmental groups continue in a utopian, denounce-everything mode. The bank is rightly fighting them.

The latest clash begins with an independent commission set up at the bank's behest, which recently published recommendations on mining and oil projects. Many were reasonable: The commission stressed the advantages of using renewable fuel; it pointed out that extractive industries have often stoked corruption; and it emphasized that people living around such projects, who put up with the environmental risks, should be consulted during project design and should benefit from the proceeds. In responding last week, the World Bank's management accepted these ideas. But it refused one of the commission's demands: that it should completely cease lending to oil and coal projects.

This last demand overlooks the facts that poor countries need energy and that the alternatives to oil and coal may not be preferable. More than 1.6 billion people have no access to electricity, and 2.3 billion depend on wood and other "biomass" fuels, which cause deforestation and pollution. Another potential fuel source is hydropower, but the environmental movement has resisted construction of dams. Other options include wind and solar power, but telling poor countries to solve their problems by those means is hypocritical, given that rich countries have taken only baby steps in that direction. Oil and coal will remain central to development, with or without the World Bank's backing. To pretend otherwise is to imply that the poorest countries in the world must shoulder the cost of fighting global warming.

By getting involved in oil and coal projects, moreover, the World Bank can improve the chances that they will be well managed. In Chad, for example, the bank has overseen the development of an oil field that environmental groups predicted would be disastrous. The construction of a subterranean pipeline has been completed safely, with minimal damage to the rain forests it travels through or to the people who live in the region. The World Bank has also overseen the creation of an institution controlled partly by Chadian nongovernmental organizations and partly by the government to ensure that oil revenues reduce poverty; if Chad's government proposes to spend oil money on something that won't benefit the poor, the new body theoretically has the power to veto it. It is too soon to say whether this experiment will succeed in disciplining Chad's corrupt and autocratic rulers. But the bank is at the forefront in grappling with the curse of oil in developing countries; mandating its withdrawal from the sector would be misguided.

A quarter-century ago, when environmentalists first attacked the World Bank, they had the moral high ground. The bank had almost no environmentalists on its staff, a crazy position for an institution that financed risky infrastructure projects in a hundred countries. But having pushed the bank to set up a large environmental department and to embrace stringent environmental safeguards, the NGOs ought to understand the scope of their own victory. Today the bank's involvement in energy projects represents the best hope that these will be responsible; but, partly for fear of NGO criticism, the bank has financed only one new investment in coal production in the past three years. The real worry is not that the bank is doing too many oil and coal projects. It is that it should be doing more of them.