The Asian Development Bank (ADB) and the Global Energy Alliance for People and Planet (GEAPP) have launched a new capital fund to accelerate clean energy access and transitions in countries across South and Southeast Asia including India, Indonesia, Vietnam, Pakistan, and Bangladesh.
GEAPP will provide an initial US$35m of catalytic capital towards the fund, which will be established and administered by ADB.
With this partnership ADB and GEAPP aim to address the challenges of climate change and energy access and transition in Asia and beyond.
Priority programmes will include supporting battery energy storage system (BESS) in Vietnam, and the early retirement of coal-fired power plant initiatives in Indonesia.
Opportunities will be supported through technical assistance, grant components for investment projects, and blended concessional instruments to crowd-in additional capital.
GEAPP’s chief executive officer Simon Harford said: “There are great opportunities to open up clean energy access and transition while addressing climate change yet in 2021 just 8% of financing for energy transition technologies went to low- and middle- income countries (LMICs) – that’s the lowest share in 10 years.
“We need to do better and act bolder, knowing we will only meet critical climate goals through collaboration and meaningful capital commitments.
“GEAPP’s partnership with ADB is a great example of this response – new and additional capital will be mobilised at a ratio of at least 15x at portfolio level to encourage the use of clean energy in the region, underpinned by practical innovation, scalable solutions, and knowledge sharing.”
The new fund will contribute to GEAPP’s 2023 priority of increasing accessibility to clean energy technologies across LMICs by unlocking new finance flows for the energy sector, driving down the cost of clean energy technology, and developing investable projects that unlock additional funding.
The partnership builds on ADB’s track record of supporting universal access to reliable and affordable energy while promoting the low-carbon transition in the region. It is hoped this model will further contribute to international climate finance ambitions.