fbpx Energy Policy | Asian Development Bank

Energy Policy

Developing countries in Asia and the Pacific have made significant advances in economic development and energy modernization, but still have much to do on these agendas. ADB's 2021 Energy Policy aims to support universal access to reliable and affordable energy services while promoting the low-carbon transition in the region.

The energy landscape has changed radically over the last decade. The Sustainable Development Goals (SDGs), the Paris Agreement on climate change, and ADB's Strategy 2030 set ambitious targets for providing reliable energy access to all, and amplified the calls for action on climate change.

ADB is responding to the transition of an increasingly multifaceted energy sector with a new forward-looking energy policy to guide its operations and to be mainstreamed with other Bank policies and goals.

Energy Challenges in Asia and the Pacific

There is an urgent need for innovative ways to generate power in a socially, economically, and environmentally-sustainable manner.

In Asia and the Pacific, energy demand is projected to almost double by 2030.
About 150 million people in the region still have no access to electricity, roughly 350 million people do not have an adequate supply.
Around 1.8 billion people rely on polluting and unhealthy cooking fuels and technologies.

Energy Transformation Involves Four Intertwined Changes

Incentives and policies to support structural and behavioral changes for improved end use energy efficiency.

From conventional carbon intensive systems to low and zero carbon power systems, with digital technologies to integrate variable renewable energy sources.

Electrification of the transport, industry, and space cooling and heating sectors in parallel with decarbonization of the electricity grid.

Participation of distributed renewable energy providers, including consumers are producers ("prosumers").

ADB's 2021 Energy Policy

To align its energy operations with Strategy 2030, ADB reviewed its 2009 Energy Policy, recognizing the changing contexts and increasing needs of ADB’s developing members while mindful of the impacts of increasing energy use to the climate and environment.

"Energy is central to inclusive socioeconomic development, but the expansion of energy systems has come at the cost of harmful impacts on our climate and environment. ADB’s new energy policy will support our developing member countries (DMCs) in the critical and urgent task of expanding access to reliable, affordable, and clean energy.

This new policy locks in our strong commitment that ADB will not fund new coal power production. Together with our elevated ambition to deliver $100 billion in climate financing to our DMCs in 2019–2030, it provides a clear path for ADB’s contribution to an environmentally sustainable energy future."

- ADB President Masatsugu Asakawa

Guiding Principles

Securing Energy for a Prosperous and Inclusive Asia and the Pacific

Securing Energy for a Prosperous and Inclusive Asia and the Pacific

ADB will help its DMCs secure energy for development by supporting electrification programs; promoting cleaner cooking, heating, and cooling; improving energy efficiency across supply and consumption chains; and promoting social inclusion, gender equality, and partnerships.

Building a Sustainable and Resilient Energy Future

Building a Sustainable and Resilient Energy Future

ADB will help its DMCs increase energy efficiency, deploy more renewable and low-carbon energy, and integrate climate and disaster resilience into energy sector operations. The policy formalizes ADB’s current practice of not financing new coal-fired power and heating plants. ADB will support a planned phase-out of coal in the region, and will commit to a just transition that promotes sustainable, inclusive, and resilient livelihoods for all in affected communities. The policy also recognizes DMCs’ request for access to affordable, new technologies.

Supporting Institutions, Private Sector Participation, and Good Governance

Supporting Institutions, Private Sector Participation, and Good Governance

ADB will support the institutional development, financial sustainability, and good governance of energy sector institutions and companies, as well as private sector participation. ADB will also help create the policy frameworks needed to manage the energy transition, including helping its DMCs to update and strengthen their nationally determined contributions and long-term strategies for decarbonization under the Paris Agreement.

Promoting Regional Cooperation and Integration

Promoting Regional Cooperation and Integration

ADB will promote regional energy cooperation and the integration of energy systems to strengthen energy security and increase cross-border access to cleaner energy sources.

Integrated Cross-Sector Operations to Maximize Development Impact

Integrated Cross-Sector Operations to Maximize Development Impact

ADB will continue to combine finance, knowledge, partnerships, and its country-focused approach to deliver integrated solutions with comprehensive and magnified development impacts.

Energy Sector Financing

ADB has made a significant contribution to the region’s energy sector, but the region’s energy financing needs far exceed the resources of any single actor.

The new policy prioritizes ADB’s resources to leverage commercial financing where possible to tackle the most difficult energy challenges.