Opening Remark - VP Xiaoyu Zhao(Fiscal and Financial Policies for Low Carbon Economic Development)
Opening Remark-VP Xiaoyu Zhao
Fiscal and Financial Policies for Low Carbon Economic Development
AFDC 2010 Biennial Forum
26 November,
Introdcution
My fellow speakers, honored guests, ladies and gentlemen: good day to you all. It is my pleasure to join my esteemed counterparts in welcoming you to the 2010 Biennial forum of the Asia Pacific Finance and
The theme of Fiscal and Financial Policies for Low Carbon Economic Development is particularly timely and relevant. ADB places great importance on this issue. Our long term strategic framework, “ Strategy
The Demand and Need for Clean Energy in
We know that “energy powers development.” It also improves the lives of the poor and creates new economic opportunities. Energy for fuel helps farmers care for their fields; a steady electrical supply allows schools and the delivery of health care; and modern fuels ensure a heated home. Energy drives the cities, manufacturing centers and trade centers that have made the region a global powerhouse. Modern, affordable energy has made the
However, the abundant and affordable energy that has powered the region’s growth has come with serious environmental, social and political costs.
ADB’s analysis suggest that
Clearly, dependence on fossil fuels – the “business as usual” approach – is not sustainable and no longer the best way to do business. We must take up sustainable, low-carbon solutions.
ADB’s Investments and the Potential for Renewable Energy in
The good news is, the transition away from “business ad usual” is already underway across the entire Asian region. ADB’s programs have evolved to meet the growing appetite for clean energy among our developing member countries. From 2005 to 2009, ADB’s total clean energy investment exceeded $5 billion. More than 45% of this($2.2 billion) was invested in renewable energy projects.
But the real potential for clean energy in
ADB’s Role and Work in the Clean Energy Sector
Our commitment is to support renewable energy and energy efficiency projects in as many sectors and ways as possible. Our Energy Efficiency Initiative, which was instrumental in raising investments in clean energy to over $1 billion a year, has since evolved into a new Clean Energy Program, expanding its scope and targets. Starting in 2013, ADB will increase its target for clean energy investments to $2 billion a year, in a bid to accelerate low-carbon growth and reduce the region’s greenhouse gas emissions. We are well on track to achieve this target with 1.3 billion approved for clean energy related projects in the first three quarters of 2010.
Our Clean Energy Financing Partnership Facility, which was established in 2007 to aid in the transformation to low carbon development, has leveraged $913 million in clean energy investments using $58.0 million in its own funds. For every one dollar from the facility, sixteen dollars of clean energy financing have been made available. This level of investment has supported projects that will bring down CO2 emissions by 7.1 million tons per year and save 7.2 Terawatt hours of energy across the region.
ADB’s Work on enabling frameworks
ADB is also involved in regulatory and policy reforms that aim to make clean energy a more obvious choice for governments. Our Clean Energy Week has now become a prominent event in the region. Nearly 1,000 policy makers, officials, regulators, utility staff, academia and knowledge bodies attend the event to share knowledge on implementing various clean energy initiatives. This past summer, ADB and USAID co-organized a Clean Energy and Governance Regulatory Dialogue – a forum for regulators to interact with their peers and share their experiences in managing clean energy development. With their power to set tariffs and decide on major issues like price and access, regulators are capable of shaping a country’s approach to clean energy in a positive manner that attracts the private sector.
ADB’s fight against poverty also takes on energy poverty, and the inability of the poor to access clean, modern power. Through our Energy for All Initiative and the ADB-led Energy for All Partnership, we are scaling up effective solutions to maximize access to energy for everyone with a target of providing energy access to additional 100 million people by 2015. Household solar and household bio-gas play an important role in these efforts. The right technology can put modern energy into the hands of those most in need of it.
Our Asian Solar Energy Initiative aims to generate 3,000 megawatts of solar power over the next three years. With donor contributions, ADB seeks to establish an Asia Accelerated Solar Energy Development Fund for extending suitable incentives for $9 billion in solar power investment.
And our Quantum leap in Wind Initiative aims to rapidly accelerate the adoption of clean energy by using economies of scale to drive down costs. Our target for this initiative is the deployment of 1 gigawatt of wind power within the next five years, at an investment of $1 billion. The roster of countries is still being finalized, but our analysis shows high potential and a broad base for wind development in countries like
Through our Carbon Market Program, ADB is using the carbon market as a tool and offering technical and financial services to developing member countries for clean energy projects that are eligible for CDM. Our Asia Pacific Carbon Fund is providing $150 million in upfront co-financing for carbon credits generated until 2012. Just recently, we launched the Future Carbon Fund, with $115 million to extend this support beyond 2012.
We are also committed to scaling up the transfer and deployment of clean energy technology. We can greatly aid the rapid diffusion of low carbon technologies by setting up an assisted broker model that identifies buyers and sellers and helps them structure a deal. We are looking into an Asia Climate Change and Clean Energy venture capital fund to invest in developers of low carbon technology, as well as market-based instrument such as renewable energy certificates.
We are also working to establish an climate public private partnership fund to attract institutional private equity funds and pension funds to invest in climate change mitigation projects in the region. As always, ADB is seeking further partnershops to ensure that these initiatives reach their maximum potential. We seek your expertise and offer ours in return.
Conclusion
Ladies and gentlemen, clean energy use in
Let us remember that all good ideas began as new ideas at the fringe of what we call the mainstream. Renewable energy and energy efficiency are a major part of what ADB does today because clean energy champions among our staff saw a potential for a better future in there ideas. I am confident in the commitment and ability of governments across the region to put their economies on a path of low carbon growth and build a better future for all.
Thank you.
