Speech by Masatsugu Asakawa, President, ADB, at the Indonesia Energy Transition Mechanism (ETM) Country Platform launch, 14 November 2022 in Bali, Indonesia
Your Excellencies Minister Sri Mulyani, Minister Arifin, Secretary Yellen, Minister Sitharaman; President Al Jasser; ladies and gentlemen:
It is an honor to join you to launch the Indonesia Energy Transition Mechanism (ETM) Country Platform. Today’s event marks a significant achievement for climate action.
Last year, at COP26 in Glasgow, ADB stood with the governments of Indonesia and the Philippines to launch the ETM Southeast Asia Partnership.
Minister Sri Mulyani, we shared the stage for that announcement and continue to work closely together. I am grateful for Indonesia’s leadership on ETM, and for the partners who are joining this effort.
Crowding in support to tackle key development challenges, such as climate change, lies at the core of ADB’s mission. I thank Presidents Al Jasser and Malpass for their shared vision and their messages commemorating today’s event.
Indonesia’s progress on ETM also provides an example for other countries to forge a path to a net zero future. ADB is committed to supporting these efforts across Asia and the Pacific. Once scaled up, ETM has the potential to serve as one of the largest carbon reduction models in the world.
Let me offer a few reflections on the significance of initiatives like ETM to achieve real progress in the battle against climate change.
I. The urgent need for climate action
Asia and the Pacific has seen remarkable economic growth in recent decades. But this has come at a cost: our region now accounts for more than 50% of global greenhouse gas emissions.
The region is also one of the most vulnerable to the impacts of climate change. We have seen unprecedented heatwaves in India, floods in Pakistan, typhoons in the Philippines, and droughts across Central and South Asia.
Here in Indonesia, 80% of disasters caused by natural hazards are related to climate change. 60% of the population lives on the coast, near it, or on small islands, where threats to habitats and food security continue to grow.
My friends, this is why climate action is urgently needed.
We need to tackle climate change with practical solutions for decarbonizing the region while ensuring strong, sustainable, and inclusive economic growth.
II. The Energy Transition Mechanism
Let me turn now to the game-changing vision of ETM.
ETM addresses three crucial areas for climate action.
First, it offers a concrete mechanism to retire coal-fired power plants early. The climate crisis cannot be solved without this, especially in our region, where many coal plants are quite young.
Second, ETM supports the installation of renewable energy sources, providing reliable energy to meet the region’s needs and maintain growth.
Third, ETM is committed to a just energy transition, protecting the poor and vulnerable, and providing access to green jobs, including for women and girls.
I am pleased with our progress on ETM over the past year. We have:
- established the ETM Partnership Trust Fund, with support from Japan and Germany;
- conducted technical and financial analysis, with input from investors and other stakeholders;
- collaborated with NGOs on a range of concerns;
- developed the Climate Investment Fund-Accelerated Coal Transition, or CIF-ACT, investment plan for Indonesia; and
- engaged in fruitful discussions about the State Electricity Corporation’s (PLN’s) portfolio of coal-fired power plants.
Today, ADB will sign a landmark Memorandum of Understanding aimed at accelerating the retirement of the Cirebon-1 powerplant in West Java. This coal-fired plant would become the first to be retired under ETM.
We join our trusted partners PLN, Cirebon Electric Power, and the Indonesian Investment Authority in this endeavor.
III. Driving climate action through partnerships
Before I close, let me reflect briefly on why partnerships like this are so important.
Effective climate action depends on a diverse group of partners: countries, multilateral institutions, the private sector, philanthropies, and civil society.
The various agreements announced today demonstrate the tremendous potential for us to work together. I look forward to future initiatives that are inspired by our cooperation.
Let me end by expressing my great optimism about the future of climate action.
ADB is proud to stand with Indonesia, and our partners, to transform the energy landscape as we move forward together on our path to a more prosperous, inclusive, resilient, and sustainable Asia and the Pacific.