Can ADB walk the talk on going green?

IN 2009, the Asian Development Bank (ADB) came up with a “clean energy agenda.” The agenda was a response to the call of UN agencies and global civil society movement for the world to phase out deadly GHG-emitting coal and fossil-based power plants, the leading cause of global warming. Unchecked, rising global temperature has been causing monstrous planetary problems such as violent storms, drought, sea rise and so on. The Philippines is in the top 5 of the world’s most vulnerable to climate change risks.

The 2009 Energy Policy of the ADB envisioned a “transition” to a low-carbon economy while meeting the needs of the people for cheap and reliable power. The ADB links this transition to various development goals: poverty reduction, environmental protection, public participation, good governance, gender equity, food security, sustainable agriculture and so on. The ADB also outlines various programs promoting renewables in energy development. It wrote:

Support for energy efficiency improvements and renewable-energy projects will be prioritized and broadened to reach as many sectors in as many ways as possible. This will [a] ease growth in fossil fuel demand and upward pressure on energy prices, [b] improve energy security, and [c] reduce emissions of greenhouse gases.”

And yet, environmental groups that have been monitoring energy projects in Asia are puzzled over the green resolve of the Bank. They see that the Bank continues to fund coal and gas plants. Thus, the criticism of CSOs that the Bank is merely engaged in rhetorical “green washing.”

Proof: the adverse finding by the Center for Energy, Ecology and Development in its review and documentation of the Bank’s energy lending program since 2009. CEED concluded that the ADB’s involvement in dirty energy projects has remained huge. ADB-funded gas- and coal-fired plants account for 50 percent of “total installed capacity of all ADB-funded energy generation projects in the past decade.” Yes, ADB has been involved in the construction of a number of renewable projects: solar, wind, hydro and geothermal. But this has not erased the fact that ADB’s involvement remains primarily with gas and coal. And this at a time when Europe and a growing number of developed countries have been exiting from gas and coal!

But end of last month (August), the ADB’s Independent Evaluation Department came up with a surprise announcement: “ADB should withdraw funding from new coal-fired projects.” IED Director Nathan Subramaniam was quite blunt: ADB’s energy policy needs to be “aligned with the global consensus on climate change.” IED’s recommendation was also straightforward:

Revisit and update the Energy Policy by emphasizing climate change mitigation and adaptation as a core priority; formally withdrawing from financing new added capacity of coal-fired power and heat generation plants, while helping DMCs [developing member countries] to phase out coal-based energy and mitigate the environmental and health impacts of the existing coal fleet; introducing sound screening criteria for other fossil-fuels….”

So will the top management of ADB, which is holding its Annual Meeting this week, formally accept the above IED recommendation? If so, will it also introduce a “phasing-out” program for the existing coal and gas plants, including those that have been erected only in the last 10 years?

What are the guidelines that should be followed in meeting the IED’s recommendation?

Along this line, CEED came up with the following proposals:

1.  Align the Energy Policy with the 1.5 celsius goal under the Paris Agreement of 2015. The point is that ADB should not hide behind rhetorical generalizations such as “clean energy” or “climate agenda.” Alignment with Paris means measuring declines in emissions, a technical process which the ADB can easily facilitate, and partnership building with Member Countries on how to meet the Paris Agreement goal.

2.  Declare a full commitment to divest from all coal mining and power projects, including coal infrastructures. For the existing coal and other carbon-intensive projects, the Bank must come up with a program for a “rapid phase-out starting with the adoption of an ambitious transition plan.”

3.  Promote community microgrids. These grids have become viable given the dramatic fall in the costs of solar and wind technologies. Community microgrids are also good instrument for building solidarity and cohesion within the community, especially in depressed and underdeveloped areas.

4.  Support innovations and enabling infrastructures. The idea is to give priority attention on renewable-energy technologies.

To the above CEED recommendations, one may add two more important points:

First, partnership building in going green is a great idea. But it should be broadened and should involve the larger society. Hence, it should not be limited to ADB-national government partnership. Nor with the private sector, a favorite financing approach of ADB which many CSOs are questioning. Partnership building with civil society and people’s organizations such as trade unions should be extended. ADB should not meet with them just for the purpose of information sharing and nothing more.

Finally, ADB should come up with a green transformation program for the whole region as well as for the individual partner countries. A “de-carbonized” Asian economy is in the best interest of the ADB and the 68 countries the Bank is supposed to be serving.


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