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ADB to support Indonesia and

Philippines’ move away from coal

PHILIPPINES THE Asian Development Bank (ADB) is to emissions, and shifting their economies to a
accelerate the clean energy transition away from low-carbon growth path.”
coal in Indonesia and the Philippines by setting “ETM is an ambitious plan that will upgrade
up the Energy Transition Mechanism (ETM). Indonesia’s energy infrastructure and acceler-
ADB President Masatsugu Asakawa, Indo- ate the clean energy transition toward net-zero
nesian Finance Minister Sri Mulyani Indra- emissions in a just and affordable manner,” said
wati and Philippine Finance Secretary Carlos Ms. Indrawati.
G. Dominguez announced the programme at “A clean energy transition in the Philippines
COP26 this week. will create jobs, promote national growth, and
The ADB said that a full scale-up of ETM lower global emissions,” said Mr. Dominguez.
in Indonesia, the Philippines, and possibly in “ETM has the potential to accelerate the retire-
future Vietnam could retire 50% of the current ment of coal plants by at least 10 to 15 years on
coal fleet, which is approximately 30GW over the average.”
next 10 to 15 years. Energy demand in Asia is set to double by
This could cut 200mn tons of carbon diox- 2030, and Southeast Asia is one of the regions
ide emissions per year. As it grows, ETM has the continuing to build new coal-fired capacity.
potential to become the largest carbon reduction Some 67% of Indonesia’s electricity and 57%
programme in the world. of the Philippines’ power generation comes from
The programme involves the ADB working coal. Indonesia has committed to reducing emis-
with government stakeholders to pilot ETM by sions by 29% by 2030 and achieving net-zero
and investigating the best business model for emissions by 2060.
each country. The Government of the Philippines recently
The ETM will bring together concessional announced plans to place a moratorium on new
resources from donor governments and phi- coal-fired power plants.
lanthropies, in close coordination with global ETM is a transformative, blended-finance
climate change-focused funds. It also aims to approach that seeks to retire existing coal-fired
leveraging private investment to fund the shift power plants on an accelerated schedule and
to decarbonisation. replace them with clean power capacity.
The ETM Southeast Asia Partnership is the The mechanism will comprise two multibil-
first of its kind in Asia and the Pacific and aims lion-dollar funds: one devoted to early retire-
to help accelerate Southeast Asia’s clean energy ment or repurposing of coal-fired power plants
transition. on an accelerated timeline, and the other focused
The partnership was endorsed by senior cabi- on new clean energy investments in generation,
net-level officials from Denmark, the UK and the storage, and grid upgrades.
US, as well as leading global financial institutions It is envisioned that multilateral banks, pri-
and philanthropies. vate institutional investors, philanthropic con-
No sums were mentioned at the launch, tributions, and long-term investors will provide
although Japanese Vice-Minister for Interna- capital for ETM.
tional Affairs at the Ministry of Finance Masato ADB will support the national governments
Kanda said that Japan’s Ministry of Finance was to establish enabling policies and business con-
committing a grant of $25mn to ETM, the first ditions to improve the program’s governance,
seed financing for the mechanism. carbon reduction, and just transition goals.
“ETM can usher in a transformation in the During the 2- to 3-year pilot phase, ETM will
battle against climate change in Asia and the raise the financial resources required to acceler-
Pacific,” said Mr. Asakawa. “Indonesia and the ate the retirement of five to seven coal plants in
Philippines have the potential to be pioneers in Indonesia and the Philippines, while facilitating
the process of removing coal from our region’s investment in alternative clean energy options
energy mix, making a substantial contribu- within these countries.™
tion to the reduction of global greenhouse gas

P10 www. NEWSBASE .com Week 44 03•November•2022