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Re: Philippines CIF ACT Investment Plan

To: Luis Tineo, Interim CEO, Climate Investment Funds (CIF) AbhishekBhaskar, Lead,ACT Program/JETP, CIF Martín Illescas, CIF Clean Technology Fund Trust Fund Co-Chair Abby Demopulos, CIF Clean Technology Fund Trust Fund Co-Chair Cc: Hon. Raphael Lotilla,Secretary, Department of Energy (DOE),GOP Felix William B. Fuentebella, Undersecretary, DOE Michael O. Sinocruz, Director, EnergyPolicy and PlanningBureau (EPPB), DOE William Quinto, AssistantDirector, EPPB, DOE Hershey Dela Cruz, OIC Division Chief,EPPB, DOE Letty Abella, OIC Supervising ScienceResearch Specialist, EPPB,DOE Ayato Kurokawa, Energy Specialist, ETM and Partnerships Team, Energy Sector Office, ADB Andrew Jeffries, Advisor, JETPs,Energy Sector Office,ADB David Elzinga, Principal Energy Specialist (ClimateChange), Southeast Asia Department, ADB Genevieve O'Farrell, Senior Environment Specialist,Southeast Asia Department, ADB Rangina Nazrieva, Senior Social Development Specialist, Southeast Asia Department, ADB Kate Hughes, Sr. Climate Change Specialist, CCSD, ADB Christian Ellermann, Sr. Climate Change Specialist, ADB Karan Chouksey, Climate Finance Specialist, ADB Andrey Shlyakhtenko, Sr. Climate FinanceSpecialist, IFC Charu Suri, Sr. Investment Officer, IFC Jonathan David Santos Chu, Investment Officer,IFC Bipul Singh, Sr. EnergyEconomist, World Bank Ditte Fallesen, Sr. Social Development Specialist, World Bank Feng Liu, Sr. Energy Specialist, World Bank -Via Email- 8 November, 2023 Re: Philippines CIF ACT Investment Plan Dear Mr. Luis Tineo,Mr. Abhishek Bhaskar,Mr. Martín Illescas,and Ms. Abby Demopulos, We are writing collectively to highlight critical concerns and questions about the Philippines’ Climate Investment Funds Accelerating Coal Transition Investment Plan – specifically with regard to the relatedADB, World Bank as well as IFC project proposals – which we understand will be tabled for discussion at the upcoming CIF Clean Technology Fund (CTF) Trust Fund Committee Meeting on 8thNovember. For your reference, we are appending the following threedocuments: (i) a letter dated 13th Septembersent to ADB and World Bank Group representatives and signed by nearly 60 civil society organizations representing local, national, regional and international constituencies (“Annex A”),

(ii) a request to delay publicconsultations to enablemore time for civil societygroups to review the draft Investment Plan (IP) that was submitted prior to the stakeholder engagement session convened on 22nd September in Manila (“Annex B”), and (iii) a formal submission to the DOE’scall for publiccomment on the draft IP duly delivered on 28th September (“Annex C”). To date,we have yet to receivea comprehensive responsein writing to either the initial letter (“Annex A”) or the range of detailed points raised in the submitted comments (Annex C). While we are dismayedby the apparent failure so far of responsible institutional representatives to take the time to address the points raised in any substantive way, we are even more so alarmed by the fact that the version of the CIF ACT Investment Plan submitted to the CTF Trust Fund for discussion has not yet been substantially revised to take into account pivotal concerns that have been raised in good faith by civil society groups in the appended documents, and explained in detail during the stakeholder engagement sessions. We will continue to await written responses from the respective institutional representatives to address the issues brought forward in the appended documents – which we expect to be specific and not a simple consolidated formulaic reply. In the meantime, crucially, we are seekingclarity from you on the steps that will be taken to ensure the IP will be revisedin order to reflect commentsand concerns raisedby civil society groups. Detailed explanations of the critical points of contention can be found in the appended documents, among them are the following:

  • Meaningful Time and Optionsfor Comprehensive Inputsfrom Civil SocietyGroups Across Sectors, Especially in Coal Affected Communities

    • The CIF ACT Investment Plan implementation has broad cross sectoral implications. As such, much more widely attended, meaningful, inclusive consultativeprocesses are necessary, not only in Manila, but also in communities surrounding proposed pilot sites, as well as other existing sites of coal power projects. Specifically, for example, the Mindanao STEAG Coal Fired Power Project (CFPP) has already been identified as a target site for the use of ETM financing arrangements (Appendix 8 of the IP). Logically, then, there could have been specific channelsmade available for integrating inputs and feedbackon the IP from residents around this site and local labor alliances representing affected formal and informal workers.


  • Transparency

    • Civil society groups in the Philippines have consistently called for disclosure of information about the sites being considered for early retirement along with with clear information about the criteria by which coal fired power projects are being selected, not sheltered by non-disclosure agreements. Yet this information still remains vague in the IP. Specifically in the case of the Mindanao STEAG CFPP, identified in the IP, which is being operated by an independent power producer and has bankable Power Supply Agreements, we are not clear the rationale for (i) why the plant owner requiresfinancial support to retire the plant and (ii) why its transition must be relinquished to the privatesector rather than decommissioned by the government.

    • According to the IP, hundreds of millions of dollars from public institutions are planned to be expended to ‘incentivize’ coal power project proponents to repurpose or retire facilities. Through these arrangements, it appears that private corporations are not going to be held liable for the harms, losses and damages incurred on the environment and residents in surrounding areas, or financially culpable for the range of remedial work required, but rather rescued from the risks of their investments. Nor would it appear that the ADB and World Bank Group are prepared to require the operators to disclose information about the adjusted Power Purchase Agreements to enable full transparency of financial flows. It therefore would appear that the model for transition as outlined in the CIF ACT IP will be enabling companies to be rewarded with early investment returns, contrary to international polluter pays principles.


  • Decommission, Not Repurpose Coal Projects; No Time False Solutions

    • Our position as social, economic, gender, environmental and climate justice advocates is clear – coal power facilities need to be fully decommissioned, with no extension of life through techno-fixes that will serve to further violate affected communities’ rights to a healthy environment, land, water,sustenance and a dignified living. Yet to date,the models proposedfor support by the ADB, IFC and World Bank consistently appear to be dependent upon the suggestion that coal power projects will be ‘repurposed’, for example by refurbishing the plants to run on biomass or refuse derived fuels. Meanwhile,there is a glaring lack of attention to rethinking and reconceptualizing just transition planning, including for instance to exploring the potential, benefits, or planning options for small-scale, community operated or distributed renewable energy options.

    • We reaffirm our position that there is no place in a just transition for projects which require burning organic matter through biomass and waste resources through refuse derived fuels, or depend upon the build out of utility scale hydropower dams – all of which take a heavy toll on the health and well-being of local communities and the environment, have onerous GHG footprints, and cannot rightfully be categorized ‘renewable’. We also reiterate the critical need for the CIF ACT Project Concepts to avoid undermining existing national environmental laws and standards (including but not limited to the Clean Air Act and the Ecological Solid Waste Management Act [1]) as well as international commitments.


  • Allocate Funds for Reparative Justice

    • We are specifically alarmed at the lack of indication of any plans for reparation and redress for the residents of communities surrounding coal fired plants to be selected for early decommissioning/repurposing under the IP. In the case of the Mindanao STEAG CFPP for instance, there is no mention of how the multiple environmental, social, and health impactsof the project will be resolved, including legacy issues related to land allocation and ongoing chronicrespiratory diseases, including high incidences of childhood asthma rates. Notably, the USD 1 million grant from CIF to be allocated for ‘just transition-related activities’ remains highly insufficient to cover land and water rehabilitation and remedial work along with redress and reparations.


  • Take Responsibility for Past Coal Power Project Financing

    • We consider it shamefulthat the grievances and calls for redress from affected residents living around coal power projects that were financedby the ADB and World Bank Group have been renderedinvisible in all aspects of the proposed Investment Plan.

    • As of the time of writing, the IFC is still in the midst of implementing a Management Action Plan (MAP) [2] in relation to its own support for financing several coal-fired power projects in the country via RCBC as a financial intermediary. One of the key aspects of the MAP was for the IFC to follow through with “assessing and addressing environmental and social impacts associated with the 10 power plants RCBC financed and the status of their compliance with IFC’s Performance Standards,” yet to date, the Compliance Advisor Ombudsman has concluded that “delays in the progressare concerning”. This should serve as an alarming red-flag for the CTF Trust Fund Task Force, as it poses serious questions of credibility and legitimacy in relation to the proposed role of the IFC in implementing the “Accelerating Development of Renewable Energy and Transition From Coal” project.

    • We urge both ADB and the World Bank Group to accept the demands from affected residents living around the coal projects they financed that both institutions be accountable for redress, reparations as well as financially responsible for a comprehensive clean up of the sites.


  • Re-Thinking and Reconceptualizing Just Transition

    • The proposed development of a “National Just Transition Approach” (IP Appendix 12) has implications for questions of social and economic development beyond the energy sector and for people across, which should be subject to rigorous democratic processes, guided by input of elected officials and rights-holders from the local to the nationallevel, not by a one-timeconsultation with a target of 20 people as outlined in the IP. In addition, the “Just Transition Framework” proposed in the IP by the ADB and WBG as currently conceptualized fails to take a holistic approach underpinned by explicit respect for international human rights, labor and environmental conventions and internationally accepted principles, such as polluter pays and precautionary principles. Of furtherconcern is the fact that the proposedprogram appears to be set to saddle the national government with USD 8 million in debt (see below).


  • Plans Should Not Exacerbate CurrentDebt Burdens

    • Components proposed for financing from the ADB and World Bank both entail the issuing of loans, meaning government institutions will be required to take on more debts to implement measuresand deep reformsas prescribed by the World Bank Group and the ADB. This effectively means implementing the IP will have the outcome of further burdening the Philippines with servicing illegitimate debts at the very time when publicfinance is neededmore than ever to supportFilipino communities confronting head-on the impacts of the climate crisis.

In light of the above, and in the more detailed documents appended, we collectively consider the process for the development of the Investment Plan and the plan itselfas thoroughly flawed.


We look forward to having clarity on options that exist to address the points of concern as outlined about the current Investment Plan before it is approvedand funds are disbursed, taking into account the initial proposed steps for an overhaul as outlined in the end of the appended letter (Annex A).


Thank you for your consideration. We are happy to arrangea time to share these concerns through an online format or to provide further details if clarifications are needed.


Sincerely,


350.org Asia 350 Pilipinas

Asian Peoples’ Movementon Debt and Development (APMDD) Freedom from Debt Coalition

Global Alliance for Incinerator Alternatives-Asia Pacific

Kilusan para sa Kabuhayan, Kalusugan, Kalikasan at Katiyakan sa Paninirahan sa Quezon City (K4K QC)

Legal Rights and Natural ResourcesCenter-Friends of the Earth Philippines

NGO Forum on ADB

ORIANG Women’sMovement

PhilippineMovement for ClimateJustice

The Center for Energy, Ecology,and Development


[1] To be clear, at the current time, Refuse Derived Fuel, biomass and municipal waste to energy incineration technologies are bannedunder the Ecological Solid Waste Management Act (RA 9003)and the CleanAir Act (RA 8749), and therefore from the get-go should be struck out as options being considered in this Investment Plan.


Download letter here.

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