The Asian Development Bank is urging Asian governments, as well as experts and investors, to aim for a low-carbon future and help reduce what it calls the “energy poverty” in the region by financing and developing technology for clean-energy projects.
The Manila-based lender last year invested a record $2.1 billion in renewable-energy and energy-efficiency projects, but ADB president Haruhiko Kuroda admitted that the institution’s resources could not match those that could be mobilized by the private sector.
“As a development bank, ADB can help shape the enabling environment for clean energy and create the incentives for faster investment on a larger scale.… But we are also very much aware of the limitations of our support,” Kuroda told attending delegates at the opening of the 7th Asia Clean Energy Forum (ACEF) Wednesday.
“Our investments cannot simply compete with the resources of the private sector, which invested $75 billion in clean energy in Asia-Pacific last year. That is why we must work together and leverage support from both the private and public sectors,” he added.
To further ease Asia’s transition toward a low-carbon future, private financing, even for the newest low-carbon technologies, will be vital in increasing the pace of clean-energy development, the ADB chief said.
“ADB has invested $40 million in two venture capital funds that focus on making climate technologies accessible and affordable. This investment is expected to leverage an additional $400 million from bilateral sources and investors searching for the next promising clean energy startup.”
Among other initiatives, the multilateral lender is also looking to invest $1 billion in demand-side energy efficiency projects in the region by 2020 as it targets to build awareness and capacity among ADB’s developing member countries.
The ADB is likewise considering the setup of more trust funds to mitigate risks often associated with clean-energy projects.
Under its Solar Energy Initiative, ADB hopes to build up an impressive $9-billion, 3,000-megawatt portfolio of solar power in the region by 2013.
“The Asian century of transition requires new technologies, more money, effective policy, international cooperation and knowledge-sharing,” Kuroda said.
Bindu Lohani, vice president for knowledge management and sustainable development at ADB, stressed the need for a “holistic approach toward a low-carbon economy.”
This, he said, should cover not only the energy sector, but also the transport, water, urban, agriculture sectors. At the same time, the region needs to ensure that all those who need energy to improve their lives and livelihoods are able to access safe and reliable source, Lohani added.
According to Lohani, there are four major areas that may be Asia’s key to attaining a low-carbon future, namely, using innovative technology to come up with energy solutions and improve efficiencies; putting in place policy and regulations that can support clean-energy initiatives; providing financing; and maximizing access to energy for the poor.—Amy R. Remo