Bank watchdog slams fraudulent ADB energy review

Bank watchdog NGO Forum on the ADB hit the Asian Development Bank today for what it called a “sham of a review of the ADB’s energy policy”. Forum executive director Red Constantino called the move as “bait and switch trickery demonstrating the bank’s contempt for public scrutiny and basic due diligence.”

The ADB announced in 2006 it was drafting an energy strategy paper that would operationalize the energy policy it approved in 1995, which would remain unchanged. The Forum said "for three years the ADB repeatedly informed its stakeholders that the ADB's 1995 energy policy will be sustained and that comments will only be for the ADB strategy draft, which bank officials said would operationalize existing energy policy." In a surprise move last week, the regional bank said it was about to launch an updated energy policy based on a document that, the ADB admits, was "developed as an energy strategy." The ADB released its first energy strategy draft in 2007. It was described by participants to the consultations held by the ADB in the same year as "mediocre" and "confused." The ADB did not disclose subsequent drafts and released a revised strategy version relabelled as an "upgraded energy policy" only last Saturday, after emails demanding full disclosure and public consultations flooded the ADB. Forum executive director Red Constantino called the move as "bait and switch trickery demonstrating the bank's contempt for public scrutiny and basic due diligence." "Is the ADB really so beholden to shady power players that it will short-circuit its own process, tamper with its own papers and change institutional policy just to favor the interests of dirty energy peddlers?" asked Constantino. "Aspirational climte-related language in the so-called Updated Energy Policy draft appears to have been added to mask the insertion of dangerous text, such as the provision which now encourages the ADB to rapidly increase its support for scandal-infested coal-mining activities across Asia," Constantino said. The ADB's operating energy policy explicitly states that the regional bank will not support coal extraction operations unless these are for mine-to-mouth, "captive use" projects. In the draft submitted last January 16 to the ADB board, the bank is allowed to finance coal extraction if coal is deemed for "substantial use" of a mine-to-mouth project. "The change is insidious," Constantino said. "The word 'substantial' will be defined incredibly loosely. A mine-to-mouth coal-fired power project merely has to state that its power station will utilize a "substantial" portion of the coal it extracts and it can export equally substantial coal tonnage to other countries. This would not be possible under the current 'captive use only' policy restriction," said Constantino. The ADB was forced to pull out of a controversial coal mine project in Phulbari, Bangladesh in 2007 because the project's design included the export of Phulbari coal to India, which conflicted with the ADB's "captive use only" policy for coal extraction. The Forum called for an official Board-level inquiry over what it called "document tampering" by the ADB team managing the energy strategy review process. The Forum said it has evidence that "the 2007 energy strategy draft on display in the ADB website is "materially different from the paper that it posted and distributed in 2007".

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NGO Forum on ADB

The NGO Forum on ADB is a network of civil society organizations (CSOs) that has been monitoring the projects, programs, and policies of the Asian Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB). 

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