MANILA, Philippines - The Asian Development Bank (ADB), one of the Philippines’ largest multilateral creditors, plans to put up about $1 billion in financing to support the country’s energy efficiency and renewable energy development initiatives in the medium-term, a bank official said yesterday.
In an interview with reporters on the sidelines of the Asia Clean Energy Forum (ACEF), Sohail Hasnie, senior energy specialist in ADB’s Southeast Asia Department, said they are now working closely with various government agencies to firm up the loan package.
“We have worked with your government and agencies and we are looking at financing up to a billion dollars with our co-financing partners for the Philippines on its energy efficiency and renewable energy programs in the next three to four years. So we are waiting for the new government for us to engage and align our priorities with their priorities,” Hasnie said.
Hasnie said the Philippine government has already secured a $125-million Clean Technology Fund (CTF) for various renewable energy projects such as solar, wind and hydroelectric.
“On the renewable energy side, as I was explaining, we will be looking at solar. You got already $125 million support from us from the Clean Technology Fund. We are looking at some hydropower and wind in that portfolio, maybe we’ll work with the private sector. On energy efficiency, we are looking at maybe large scale air-conditioning use in public offices and others, by reducing air-conditioning consumption. We are looking at how to promote energy efficiency in refrigerators. We’ll be looking at domestic fan (how to use it efficiently and make people aware of those things),” he said.
Hasnie said there are growth areas in the renewable energy sector that need to be fully tapped.
“Renewable energy is an area that will grow. And I think in the Philippines, you have all the necessary parameters for promoting renewable energy: a very high electricity tariff; a lot of available renewable energy; a very good regulatory framework. If the country wants to reduce its reliance on imported fossil fuel, obviously it has to save energy by way of energy efficiency, and look at alternative and indigenous sources of energy the country has - hydro, wind, geothermal, etc,” he said.
The ACEF is held annually to discuss technology transfer and finance in a range of areas including energy efficiency, renewable energy, access to energy for the poor and climate change. The forum is now on its fifth year.
“Building on our substantial response to climate change, we are committed to sharpening our focus on technology to meet the new needs of our developing member countries,” ADB president Haruhiko Kuroda said.
In his speech, Kuroda pointed out that ADB had increased its own targets for clean energy investment.
“From an initial target of $1 billion a year between 2008 and 2012, we are now targeting $2 billion a year by 2013. Compared to the public and private investments needed by countries in the region, this is a very small drop in a big bucket. Thus, it is particularly necessary to attract a vast amount of private investment to our region,” the ADB chief said.
“It is a long-standing ADB policy to bridge funding gaps through public private partnerships. In this case, the role of governments is clear- to craft the necessary policies and regulation to facilitate the transition to low carbon development.”
The five-day forum is organized by ADB and the United States Agency for International Development (USAID), with assistance from the World Resources Institute (WRI), and sponsorship by the governments of Australia, Japan, Norway, Spain and Sweden.
“The Asia-Pacific region has tremendous potential for deployment of clean energy as well as a critical need to transition to cleaner sources of power,” said Olivier Carduner, mission director for USAID’s regional development for Asia.
ADB has announced a range of initiatives to bring down barriers-such as price and policy issues-that prevent the wide-scale adoption of low-carbon and clean-energy technologies in the Asia and Pacific region.
These include ADB’s Asia Solar Energy Initiative (ASEI) that aims to identify and develop large -capacity solar projects that will generate 3,000 megawatts (MW) of solar power by 2012.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration.
In 2009, it approved a total of $1.6 billion in financing operations through loans, grants, guarantees, a trade finance facilitation program, equity investments, and technical assistance projects. ADB also mobilized co-financing amounting to $3.2 billion.