Manila, Philippines - One week before the Asian Development Bank’s Board of Directors deliberate on the proposed 2021 Energy Policy, civil society organizations from Central, South, Southeast and East Asia have come together to denounce the policy as unequivocally climate mis-aligned. They warn that this policy undermines not only the latest climate science and efforts to limit the rise in global temperature to 1.5C, but also the ecosystems our very survival depend upon, exacerbating social, economic and climate injustices and plunging millions into further livelihood precarity.
Before the final decision on approving the 2021 Energy Policy (“R-Paper”) is made by the representatives of the ADB’s shareholding governments, civil society groups urge them to go back to the drawing board, reconsidering several key provisions of the policy.
According to a report released by the ADB’s own Independent Evaluation Department in recent weeks, the Bank’s “climate outcomes are not well tracked, investments in adaptation have not achieved their targets, the portfolio and pipeline lack ambition, and strategic and institutional arrangements are not commensurate with the challenges to enable ADB to lead on climate action.” The report recommends the development of “clear steps on how ADB will support DMCs [Developing Member Countries] to transition away from fossil fuels and super-pollutants”.
Indeed, information published in the most recent assessment of the Intergovernmental Panel on Climate Change (AR6: August 2021) leaves no doubt that fossil fuels must be left in the ground to stay within the parameters of a 1.5C temperature rise. Grounding their concerns in the lived realities of people affected by ADB financed energy infrastructure, the civil society groups are together calling into question ADB’s claims to be the “Climate Bank” of Asia and the Pacific. They note that the revised 2021 Energy Policy will enable the ADB to ramp up financing for resource-intensive projects including:
Fossil gas projects, including LNG terminals (para 76), and “where necessary”, oil-based power systems, specifically in isolated and remote areas, and fragile and conflict-affected situations (para 74)
Infrastructure for power connectivity, inclusive of pipelines for oil and gas but also transmission lines connected to fossil fuel based facilities (potentially inclusive of coal, oil or gas)
Carbon capture and storage facilities for power plants, LNG import facilities, and other fossil fuel reliant industries as well as industrial-scale blue hydrogen projects and infrastructure (reliant on fossil gas burning) (Paras 73, 77, 78)
Large-scale hydropower projects – without any requirement for cumulative impact assessments or involvement of independent environmental, social, and dam safety experts (para. 70)
Large-scale waste to energy projects for heating or electricity purposes (para. 71) and large-scale biogas projects that feed into current gas networks (para. 78)
In addition, these groups have united to condemn the policy as lacking in:
Any concrete commitments to meet the electrification needs of last-mile communities (referenced once in the policy’s 119 paragraphs)
Any rigorous screening criteria for projects financed as part of the Bank’s climate portfolio (e.g. no incorporation of conditions to ensure investments are not associated with facilitating further build up of coal, oil or gas)
Greater commitments to renewable energy development, especially for hard-to-decarbonize sectors such as industrial processes, heating, cooling, and cooking
Any time-bound commitment to align equity investments, loans and direct project financing with the provisions and objectives of the Paris Climate Accord
Any clear information about the rate of social cost of carbon being applied, the annual scaling rate, and how calculations will align with international best practices
Any clear reference to provide assurances that support for just transition planning in developing member countries would be rolled out in accordance with ILO and other international human rights conventions, including for communities most affected by the ADB’s own operations
Acknowledgement of energy as public common good, ensuring the processes of a just transition are grounded in local realities, inclusive and sustainable, fully accountable to people not merely shareholders
Clarity on whether accompanying guidance notes will be made publicly available, let alone subject to a process of robust public consultation
Although the 2021 Energy Policy will be reviewed and revised again within the coming five years, the injustices that can be wrought on communities and the damage to ecosystems over this time cannot be underestimated, civil society groups say. It is with this in mind that they urge the ADB’s Board to take heed, recognizing their responsibilities to the people of the developing member countries; those who are at the frontlines of the climate crisis.
Civil society representatives released the following statements in reaction to the revised 2021 Energy Policy ahead of the Board of Directors scheduled vote on 20th October:
Rayyan Hassan, of the NGO Forum on ADB (Regional):
“The ADB’s R paper has opened the doors for oil, gas, incinerators and large hydropower projects. The recent pronouncement from the ADB that they are Asia’s ‘climate bank’ is directly misleading. Instead, their financing portfolio is effectively set to derail the region from the global effort to meet Paris Agreement commitments as per the recommendations of the most recent assessments of the Intergovernmental Panel on Climate Change to keep as close as possible to a 1.5C trajectory.
Post-policy approval, we urge Board Members to scrutinize all energy investments against international climate ambitions, heeding the concerns of communities affected by the very projects they finance.”
Hemantha Withanage from the Friends of the Earth International and Center for Environmental Justice in Sri Lanka:
“While I commend the ADB for committing to deliver climate financing to its developing member countries (DMCs) amounting to $100 billion from 2019–2030, we cannot understand why ADB continues to support dirty energy including LNG and waste-to-energy which contribute to climate change. The new ADB energy policy still keeps provisions under section 76 to support LNG and finance investments in natural gas infrastructure—including gas T&D pipelines, LNG terminals, and storage facilities— and natural gas-based end-use etc. As Asia and the Pacific is more vulnerable to climate change with the highest number of climate refugees, if ADB wants to claim itself as the ‘climate bank’ of the region, we demand ADB to support only renewables and just energy transitions.”
Lidy Nacpil of the Asian Peoples' Movement on Debt and Development (Regional):
“Fossil fuels, harmful projects and unsustainable and illegitimate debts have no place in a prosperous, inclusive, resilient, and sustainable Asia that the Asian Development Bank claims to be working for. The ADB must stop all financing and support for fossil fuels, dangerous and false solutions to the climate crisis, and other harmful projects and immediately cancel outstanding debts connected with fossil fuel projects or convert these to grants for renewable energy.”
Toshi Doi from Mekong Watch (Regional):
“I contest ADB’s claim to be a ‘climate bank’ as its new Energy Policy still attempts to support large hydro. Large hydro is not clean nor sustainable and it reduces climate change resilience because it devastates river ecology and threatens natural resources, most importantly fish, which lives and livelihoods of local communities, including women, children, and elderlies, critically rely on. Large reservoirs also emit methane. ADB should learn how severely its Greater Mekong Subregion (GMS) program, by promoting large hydro, has affected the Mekong River and its riverine communities, and exclude any support for large hydro from its energy policy.”
Yobel Novian Putra from the Global Alliance for Incinerator Alternatives-Asia Pacific (regional):
“The ADB should be ashamed of their outright greenwashing effort in classifying Waste-to-Energy (WtE) incinerators as part of green bonds, blue bonds, and climate financing projects. There are at least 8 WtE projects that ADB classified as climate mitigating activities. Waste incineration is a highly carbon-intensive process which undermines our climate targets -- especially when it burns plastic which is another form of fossil fuel. It is not part of a circular economy and discourages waste prevention and recycling. The European Union has excluded WtE incineration from its Just Transition Fund, Regional Development, and Cohesion Fund. It is frustrating to see that waste is still classified as a renewable energy source in the R-Paper, contradicting the IPCC’s definition of renewable energy sources.”
Titi Soentoro from Aksi! For Gender, Social and Ecological Justice in Indonesia:
First of all, I would like to condemn the promotion of geothermal in the new ADB Energy Policy. This promotion is a real threat for people in volcanic countries, like Indonesia for example, that are targeted heavily for geothermal extraction. ADB, again, disrespects the suffering of the peoples and environment from geothermal extraction.
There are many aspirations in this new ADB Energy Policy regarding women: women as key agents of change in the energy transition, promoting and supporting women’s participation in energy policy- and decision-making, women’s entrepreneurship to expand energy access and address energy poverty, and so on. Based on the experiences in monitoring ADB's projects, the usual practice is that this aspiration would stay as such.
It is a misconception that gender inequality in the energy context is because of a lack of women's access to clean and modern energy services. The extraction of energy sources, like geothermal, biofuel, coal, among others that triggered the loss of livelihoods and natural resources, and the system that controls the energy business, are the causes of gender inequality in the energy sector. Moreover, ADB's induced strategy of privatization including electricity and water has created the structural barriers for women's lack of energy access. The new Energy Policy shows that ADB failed to recognize this. Hence, how will the Energy Policy dismantle its own created barriers?
The new Energy Policy states that it will consult women meaningfully, conduct gender analysis, and collect sex-disaggregated data to ensure that gender is mainstreamed throughout the project cycle (para 64). ADB fails to apply gender considerations in the Safeguard Policy Statement (SPS) 2009 that precisely about the participation of women and gender impacts and risk assessment. So, how will this new Energy Policy ensure that paragraph 64 would be implemented?
The international communities agree to leave the extractive high carbon path and go to the low carbon path. However, without structural change of the extractive mode "business as usual", the low carbon development path will have the same systematic exploitation and oppression. The ADB's new Energy Policy does not show a transition from this mode of business as usual.
Ikrom Mamadov from the Youth Group on Protection of the Environment in Tajikistan:
“The ADB's Energy Policy should consider all possible factors that may negatively affect countries in Central Asia and the Caucasus. In particular, the policy should ensure a just transition and offer specific conditions of support that ensure detailed consideration of the local people, since they are the ones who may suffer the most.
The ADB has the opportunity to strengthen control over the implementation of all international norms and requirements, reducing environmental impacts in the process of project implementation while ensuring a just transition to alternative energy sources. Preventing negative impacts on the environment is equal to the protection of people's interests.
We urge the ADB Board to reconsider approving the Energy Policy until it is revised to explicitly include more detailed assurances of a robust implementation mechanism, whereby everyone could get an answer to the question of how their financing will be used to support a just transition in our communities.”
Avril De Torres from the Center for Energy, Ecology, and Development (CEED) in the Philippines:
"For over a decade, ADB was guided by an energy policy that catapulted developing countries like the Philippines to fossil fuel dependence and the world to exacerbating climate change. Should the new policy be approved as is, the bank is setting itself up to repeat history. ADB had a promising start with the declaration of a no-coal policy, yet is now leaving the door open for fossil gas against the backdrop of record high fossil gas prices and massive fossil gas expansion in Asia. It seems keen on maintaining a dirty energy legacy but we cannot allow it to consign climate-vulnerable Asia-Pacific to catastrophe when it is well-equipped to lead genuine energy transformation by supporting a rapid and sustainable expansion of renewables among its member countries."