By Roy Mabasa
Civil society organizations in the Philippines expressed dismay upon learning that the Asian Infrastructure Investment Bank (AIIB), through its energy sector strategy, will continue funding “dirty energy.”
AIIB is a new Chinese-led multilateral financial institution founded to bring countries together to address the daunting infrastructure needs across Asia. Just recently, the bank developed an energy sector strategy in order to guide its future engagement with and investments in the energy sector. The AIIB has claimed that the strategy will be consistent with its “Lean, Clean and Green” core values. Consequently, the strategy was developed in a transparent and collaborative way with two rounds of public consultation.
AIIB President Jin Liqun has declared during the 2nd annual meeting of the board of governors held earlier this week in Jeju Island, South Korea, that the AIIB will continue to “promote clean and efficient energy generation transmission and distribution,” and “help members meet nationally determined contributors (NDCs) under the Paris agreement,” recognizing its “role to play as supporter and facilitator of a transition towards a low carbon economy.”
Jin further highlighted that currently there are no coal projects in the bank’s pipeline, and that it will not consider any project if we are concerned about their environmental and reputational impact.
However, according to Center for Energy, Ecology and Development convenor Gerry Arances, although they welcome the positive take on coal expressed by the AIIB president, this is not exactly what the Energy Strategy Paper is saying.
Arances pointed out the doublespeak in the AIIB’s position on coal investments by citing the Energy Sector Strategy wherein it was stated that “carbon efficient oil- and coal-fired power plants would be considered if they replace existing less efficient capacity or are essential to the reliability and integrity of the system, or if no viable or affordable alternative exists in specific cases.”
“The continued financing of coal is a failure from the part of the AIIB to distinguish itself from other financing institutions like the World Bank and the Asian Development Bank, which have been tagged as enemies of the environment and climate due to their continued support for dirty energy,” said Arances.
“Financing coal also makes little economic sense, especially for citizens who will be paying more and more for it, as coal is set to become ‘stranded assets’ given the declining cost of renewable energy and the hazards and risks attached to coal energy projects.” he continued. “This means that Filipinos will spend decades paying higher for energy from coal, when they could be paying less by incorporating more renewable energy in the mix,” Arances explained.
Arances said they are challenging the AIIB president to have this anti-coal perspective reflected in the bank’s energy strategy.
In an open letter submitted to the AIIB board of governors before the energy sector strategy was unveiled, Philippine CSOs have called upon the AIIB to stop funding dirty, deadly and costly energy projects such as those reliant on fossil fuel and nuclear energy. Emphasis was given to funding on coal, which has been cited as among the leading sources of Greenhouse Gas (GHG) emissions, one of the primary causes of man-made climate change.
“In including acceptable conditions for coal to be financed, the AIIB has left the door open for policymakers and companies who intend to disregard the externalized costs of coal to the environment, livelihood and health of affected communities,” said Atty. Aaron Pedrosa of Sanlakas.
Pedrosa noted that a study by Harvard University has shown that the construction of new coal projects could lead to over 70,000 deaths in Southeast Asia alone by 2030.
Tags: Asian Infrastructure Investment Bank, Center for Energy Ecology and Development, civil society organizations, Civil society organizations dismayed at AIIB energy sector strategy, Dirty Energy, Lean Clean and Green, Manila Bulletin