On May 4, 2023, Fair Finance Asia (FFA) launched a discussion guide on the Asian Development Bank’s (ADB) Energy Transition Mechanism (ETM) alongside the 56th ADB Annual Meeting (ADB AGM). This guide is based on a report, The Asian Development Bank’s Energy Transition Mechanism: Emerging Social, Environmental and Rights-Based Considerations, launched in January 2023 by FFA and NGO Forum on ADB (the Forum), which highlights the following concerns about the ADB’s ETM:
- The mechanism does not require participating governments or companies to suspend the development of planned or under-construction coal power projects and commit to phasing out coal power by 2040, as the Paris Climate Agreement mandates.
- There is a lack of clarity regarding the extent to which the Asian Development Bank’s (ADB) social and environmental safeguards will apply at pilot coal power project sites during retirement (estimated by the ADB to take 10-15 years). Further, it is uncertain if surrounding communities can file grievances under the ADB’s accountability mechanism.
- Community groups, labor rights groups, local union bargaining units, and other concerned civil society groups lack channels to meaningfully shape the terms of coal power project retirement (and hence their future) as negotiations for site-specific retirements occur behind closed doors.
- There is a lack of clarity on the definition of clean energy options to be developed and the parameters for repurposing projects.
- There is a lack of transparency regarding the terms and conditions for coal power project retirement.
The discussion guide also provides updates on civil society organization (CSO) engagements with the ADB ETM across Asia (it was last updated on June 16, 2023).
To read the full ADB ETM discussion guide, click here.
To read FFA-the Forum’s ADB ETM report, click here.