Asian Peoples' Movement on Debt and Development

A regional alliance of peoples’ movements, community organizations, coalitions, NGOs and networks

 

Ecological Debt, Environmental Justice & Climate Change

Regional CSO urges Asian governments: Strip the veil of ADB’s clean energy showcase, expose the lie of “clean coal” and other false solutions to climate change

The Asian Development Bank  (ADB) claims concern in addressing the causes of climate change as it convenes the Asia Clean Energy Forum (ACEF) from June 6 to 10 in Manila.

It  appears to recognize the inconvenient truth on the contribution of fossil fuel usage to global warming, which is now universally recognized after the Conference of Parties 21 of the United Nations Climate Change Conference in Paris last year.

Yet, the said financial institution is still peddling the lie of “clean coal” and other false solutions to the climate crisis at the ongoing conference, from promoting Carbon Capture and Storage schemes to investing in Waste-to-Energy projects to encouraging private sector investments in the expanding market for renewable energy.

The Asian People’s Movement on Debt and Development (APMDD) calls on Asian governments to unmask the ACEF for what it really is – a roadshow to rationalize continued fossil fuel usage for the energy needs of big business and industry. As it is themed, ACEF is indeed a showcase of “clean energy”, which we know all too well as sanitizing fossil fuels in the face of rising global awareness on their critical role in the climate crisis.

APMDD asserts that ACEF 2016 is yet another staging ground, post-COP-21, for pursuing ADB’s sales pitch of selling “clean coal” as well as the range of other so-called “clean energy” technological solutions to the profound, historical and systemic issues at the root of climate change. This position is based on the following grounds:

  1. From 1994 to 2012, ADB financing for 21 coal-fired power plants reached $3.9 billion, making it the third largest public international funder of such projects. In 2013, it committed to increasing support for “energy efficiency projects”, in order to help developing Asian and Pacific countries take advantage of the “low-hanging fruit” of energy efficiency interventions in the form of “smart technology”.  By then, it had reached its target of raising at least $2 billion in annual “clean energy” investments;

  2. The ADB previously revealed its intention to “selectively support coal-fired power plants if cleaner technologies are adopted and adequate mitigation measures are incorporated into project design”[1].

    As the ADB explains it, “Coal-fired power generation projects can make an important contribution to a country's development if they are developed in a responsible and sustainable manner. ADB will selectively support coal-based power projects provided cleaner technologies are adopted and adequate mitigation equipment and measures are incorporated into project design”[2]. These include schemes such as Carbon Capture and Storage, Enhanced Oil Recovery, Enhanced Coal-Bed Methane Recovery, Supercritical to Advanced Ultra-Supercritical thermal coal technology, etc.

  3. ADB’s intervention for “clean energy” only refer to financing projects that are more technologically efficient, enable diversification of a member-country’s energy mix and lessen dependence on heavy fuel oil, even as these efforts remain fossil-fuel based. One example is the Jamshoro Power Generation project in Pakistan (still non-operational), for which ADB provided a $900 million loan in 2014 to install a 600-MW (net) supercritical coal-fired unit and provide 5 years of operation and maintenance support, among others.  (Supercritical power plants operate at a higher efficiency in terms of temperatures and pressures) than conventional coal-fired power plants.) The infrastructure will also support government’s plan to build an additional 600-MW unit at the same site with provisions for CCS technology.

    Another project is the Mundra Ultra Mega Power Project (MUMPP), a 4,150-megawatt (MW) coal-based power generation plant in Gujarat, India operating since March 2013. Controlled by a subsidiary of India’s biggest private power utility, Tata Power Company Limited, MUMPP was made possible in large part through ADB's direct loan of $450 million granted to the firm in 2008. Other lenders include the Export-Import Bank of Korea, the International Finance Corporation, the Korea Trade Insurance Corporation, BNP Paribas SA and more than a dozen Indian lenders, led by the State Bank of India. By ADB’s standards, MUMPP is considered a clean energy intervention because it uses supercritical boilers, claimed to be the most energy-efficient coal-based power generation technologies which reduce fuel consumption and greenhouse gas emissions[3].

    In the Philippines, ADB extended loans of $120 million for the construction of the Korea Electric Power Corporation’s 200-MW coal-fired power plant in Cebu province, and $200 million for the rehabilitation of the Masinloc Power Partners Ltd.’s 600-MW coal-fired thermal power plant in Zambales province. Eleven other coal plants in the Philippines that ADB helped fund have shown dangerous discharges of mercury, arsenic and lead, in addition to the dirty energy that they typically emit. The Bank recently provided “credit-enhancement” for the issuance of the first climate bonds in Asia-Pacific: PHP10.7 billion (over $230 million) climate bonds of a subsidiary of Aboitiz Power, a major coal-producing firm in the Philippines.

  4. The ACEF aims to ensure the needs of big business and industry for greater and cheaper energy, not the needs of grassroots people and communities who are supposedly in the frontlines of ADB’S poverty eradication mission. There is no dedicated discussion space in this Forum on communities’ energy needs, access, and the implications on the enjoyment of their basic human rights of profit-seeking private sector-led energy initiatives. The real intent of ACEF is to encourage private sector investments on “clean coal” by promoting financial instruments such as “blended finance” that taps into money intended as development aid to catalyse private finance for undertakings packaged as “clean energy” and “energy efficiency” projects.

  5. Lastly, the ACEF glosses over ADB’s long and dirty history of funding conventional fossil fuel projects, several of which resulted in irreversible and continuing harm in the destruction of natural resources, the displacement of homes and livelihoods, and the exacerbation of climate change, among others. ADB’s much touted safeguards have proven inutile in effectively responding to the magnitude of the damage it has inflicted on communities and their environments.

 

No to dirty and harmful energy!

Expose and resist false solutions to the climate crisis!

No to debt-creating financial instruments, no to domination of private finance and market instruments!

End ADB lending to corporations that exacerbate the climate crisis!


[1] https://www.devex.com/news/coal-or-no-coal-a-balancing-act-for-mdbs-87610

[2] http://www.adb.org/projects/41946-014/main#project-facts

[3] http://www.adb.org/projects/41946-014/main#project-pds