PMCJ to ADB's ETM: No bail out for Coal Companies

The Philippine Movement for Climate Justice (PMCJ) challenges the Asian Development Bank (ADB) to center its climate financing on adaptation for vulnerable countries and rapid deployment of renewables, as a rebuke to ADB’s Energy Transition Mechanism (ETM) launched last November 3, 2021.

Through the establishment of ETM facilities in vulnerable countries such as the Philippines, Indonesia, and Vietnam, ADB claims it will purchase coal-fired power plants in order to accelerate its decommissioning within 15 years and assist in jumpstarting reliable and affordable clean energy. While ADB has been working with different financial institutions, as well as Japan's Ministry of Finance who committed a grant of $25 million, part of the ETM will still be publicly funded.

PMCJ asserts that the ADB fails to recognize the urgency of the climate crisis and severe impacts which coal and fossil companies and the Global North should be held accountable given their historical contributions to global greenhouse gas emissions. Ian Rivera, National Coordinator of PMCJ, states that the ADB’s coal retirement plan is absurd and off tangent to effectively address the urgent climate action needed. Instead of focusing on the “patients”, ADB is more interested in helping the perpetrators of the climate crisis. The scheme is essentially a bail-out for those who committed the crime of killing the planet. People of the global South who are already bearing much of the impacts of the climate crisis must not be burdened for the climate crimes that big, rich countries have committed. ADB’s program to retire coal hinges on the use of public funds is outrageous.

Atty. Aaron Pedrosa, Secretary-General of Sanlakas and Co-convenor for the PMCJ Energy Working Group, adds that with the gaping loophole, ETM should be re-oriented towards swiftly raising the finance needed to address climate impacts and energy transition to renewables. ADB’s 15-year timeline on the ETM contradicts current science that confirms the needed urgency of decommissioning and transitioning into renewables, thus prompting PMCJ to pressure the ADB in coming up with more urgent actions and goals for their ETM, in line with the schedule of the targets in the Paris Agreement.

Flora Santos of ORIANG Women’s Movement also states that the ETM is gender-blind. Women are the most affected by the climate crisis as many do not have access to energy, and the ETM has glossed over the importance of the impacts of any energy transition on women. Any schemes to address the retirement of coal plants must ensure that energy transition will not create debt and place an additional burden on women, and must instead be clean, predictable, and affordable.

For the ADB’s energy transition policies to be successful, PMCJ urges that climate justice must be at the center of its framework for climate finance. Climate Finance should be allocated to address the adaptation needs of the vulnerable countries and the much needed energy transition through the deployment of renewables. No amount of public funds must be spent as bailout money for coal and fossil companies. With the Conference of Parties (COP) 26 currently ongoing in Glasgow, ADB must stand with governments of developing countries in raising climate finance for the vulnerable.