May 26, 2021 Read More →

Asian Development Bank shuns coal investment, cites declining industry, lack of demand and debt worries, may move to gas investment

Energy Tracker Asia: 

Owing to the decline in coal demand and strong criticism by climate institutions, global financiers across the world have started distancing themselves from fossil fuel investments. In its recent draft energy policy, the Asian Development Bank (ADB) declared that it will not indulge in coal financing. However, the Philippines-based global bank stated that it may support natural gas projects based on certain criteria.

“ADB will not participate in investments to modernize, upgrade, or renovate coal facilities that will extend the life of existing coal-fired power and heating capacity,” it states in its draft energy policy. The only exception is “to re-engineer such plants for use of cleaner fuels, such as natural gas or renewable energy sources”.

ADB’s energy policy announcement could increase pressure on other lenders to withdraw funding from coal power and fossil fuel companies. However, critics believe that many such financial institutions have moved their portfolios to finance gas as a transitional fuel. “It is urgent that ADB also declare the withdrawal from expanding gas and oil projects”, Lidy Nacpil of the Asian Peoples’ Movement on Debt and Development (APMDD) told Energy Tracker Asia. “The new ADB energy policy must state categorically an all-encompassing end to the bank’s involvement in coal, gas, and oil projects.”

APMDD also raised strong concerns on the rising debts of Asian economies from ADB’s fossil fuel investments. In 2019 around 16 developing member countries including lower to middle income paid more than $6.4 billion as debts owed to ADB.

[Ankush Kumar]

More: ADB’s Double Standard On Fossil Fuel Investments

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