astae

ASTAE

Status ReportConsultative Group Meeting April 3, 2009

Washington, D.C.

Asia Sustainable and Alternative Energy Program

1

Outline

1. Strategic Context2. ASTAE FY08 - Implementation Highlights3. Pipeline FY094. Indicators 2008-20095. Business Plan 2009-20126. Funding Status & Staffing



1. Strategic Context

The EAP region has the fastest energy demand growth among all regions in the worldCoal to account for nearly half of primary energy environmental impactsOil imports to rise security concerns

EAP to account for 30% of global energy demand growth 2002-20(IEA 2004)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

2002 2010 2020

Prim

ary

ener

gy (

Milli

on to

ns o

il eq

uiv)

USA+Canada EU Developing East AsiaSouth America South Asia Japan+KoreaRest of the World

EAP medium-term needs in power (excl. China)

0

1,000

2,000

3,000

4,000

5,000

6,000

Tim

orLe

ste

Mon

golia

Cam

bodi

a

Lao

PD

R

PN

G

Phi

lippi

nes

Vie

tnam

Indo

nesi

a

US

$ m

illio

n p

er y

ear

Power needs are rising in the EAP, and not only in China

Power generation is dominated by coal (~75%); oil (~10%); gas (~10%); rest is renewable energy + nuclear


Countries with Largest Percentage Increase in Emissions: 1994-2004

0

10

20

30

40

50

60

70

Malaysia Thailand China Iran Spain India SaudiArabia

Turkey Egypt UnitedArab

Emirates

Indonesia

Per

cen

t

1994-1999

1999-2004

As a result, several EAP Countries have High and Accelerating Fossil Fuel CO2 Emission Growth


China is the 2nd largest source of global greenhouse gas emissions Indonesia is the 3rd if biomass is considered

-1000

0

1000

2000

3000

4000

5000

6000

7000

USA China Indonesia Brazil Russia India

MC

TO

2e

Energy Agriculture Forestry Waste

Transport5%

Industry16%

Other9%

Agriculture14%

Land-Use Change & Forestry

34%

Waste3%

Electricity & Heat19%

Source: WB, 2007, based on data sources for energy: IEA 2005 (except Indonesia, which uses PIE 2005); agriculture, 2005 data from USEPA 2006; Forestry: Houghton 2006; waste: 2005 data from USEPA 2006

Source: WRI, 2007

Note: LULUCF: Land Use, Land Use Change and Forestry; the methodology of estimating emissions from land use is not as widely accepted as from fossil fuels

Global ranks – highest CO2 Emitters Main sources of CO2 emissions in EAP, 2000


Energy Demand is Growing Dramatically, Especially in China…

0

200

400

600

800

1000

1200

2005A 2010E 2020E

Coal Renewable Oil Natural Gas Nuclear

35

60

96

145

0

20

40

60

80

100

120

140

160

2005A 2010E 2015E 2020E

Vehicle Population, China (millions)Installed Generation Capacity, China (GW)

Over 7

50MW

per

wee

k

Over 2

0,000 ve

hicles

per

day


10

410

430

450

480

770

0 200 400 600 800 1000

China

OECD Europe

Japan

UK

Canada

USA

Cars/1000 population in international comparison, 2003

China’s private car use (share of total transport) grew from 6 to 23.2% (1990-2003)


EAP in 2010: Coal dominant, oil & gas risingPrimary energy consumption (IEA 2004)

0

500

1,000

1,500

2,000

2,500

EA

P 2

00

2

Ch

ina

20

02

EA

P 2

01

0

(BA

U)

US

A+

Ca

na

da

20

02

EU

20

02

Jap

an

+K

ore

a

20

02

Mill

ion t

ons o

il equiv

ale

nt

(Mto

e)

Biomass

Otherrenew ablesHydro

Nuclear

Gas

Oil

Coal

Country Consumption2003-2006 Annual

Growth RateTotal Energy 11.38%

Coal 11.78%Total Energy 3.24%




Coal 11.15%Philippine

China

Indonesia

Malaysia

Thailand

Total Primary Energy and Coal Consumption

Source: BP World Energy Review, 2007

o Coal dominates power generation (~75%)

o Coal consumption growth outpaced total energy growth by 65%

o China became coal importer in 2006

o Vietnam’s coal share in total energy mix is expected to increase from 13% in 2005 to 20% in 2010

Coal Continues to Dominate Energy Production


Trends and Projections for CO2 Emissions from Energy


Electrification

Rate %Population without

electricity (m)

Population with

electricity (m)

China 99.4 8.5 1302.1

Indonesia 54 101.2 5

Philippines 80.5 16.2 66.8

Thailand 99 0.6 64.1

Vietnam 84.2 13.2 70.3

East Asia 88.5 223.5 1727.5

Economies in Transition (EIT) and OECD 99.5 8 1501

In 2005, 223 million people in EAP still did not have access to electricity

…at the Same Time, Access to Energy is still a Challenge for Many Countries


Droughts Floods Storms Sea Level rise (1m) Agriculture

Malawi Bangladesh Philippines All low-lying Island States Sudan

Ethiopia China Bangladesh Vietnam Senegal

Zimbabwe India Madagascar Egypt Zimbabwe

India Cambodia Viet Nam Tunisia Mali

Mozambique Mozambique Moldova Indonesia Zambia

Niger Laos Mongolia Mauritania Morocco

Mauritania Pakistan Haiti China Niger

Eritrea Sri Lanka Samoa Mexico India

Sudan Thailand Tonga Myanmar Malawi

Chad Viet Nam China Bangladesh Algeria

Kenya Benin Honduras Senegal Ethiopia

Iran Rwanda Fiji Libya Pakistan

Note: The typology is based on both absolute effects (e.g., total number of people affected) and relative effects (e.g., number affected as a share of GDP).

Most Effected EAP Countries by Climate-Related Threats


The Bali Roadmap Sets a two-years time frame to strengthen the international response to climate change

A central element of the roadmap for developing countries is the focus it places on creating investment opportunities by developing climate friendly technology and finance

Several EAP countries have set ambitious targets for renewable energy generation, energy efficiency improvements, and access to electricity – much remains to be done to reach these targets

Renewable Energy

China has the most ambitious targets for renewable energy and is the most likely country to attain / surpass them.

% of primary energy

2010/2015 2020

China 10% 15%

Thailand 8% (2011)

Vietnam 5%

Mongolia 3-5% 20%

Philippines 5GW (2013)


Energy Efficiency

Energy efficiency is low in the EAP region compared to OECD average

Low Efficiency: Energy consumed per unit of GDP is still high in major EAP countries

(Energy consumed to produce 1,000 dollars of GDP in 2003)

0.0

0.5

1.0

Source: World Bank WDI Online, BP Statistical Review of World Energy 2004

Diversity: Access levels across region

0%

25%

50%

75%

100%

-1 0 1 2 3 4Population Level (Log of population in millions, 2002)

% o

f p

op

ula

tio

n w

ith

ele

ctri

city

ac

cess Indonesia

Vietnam

Philippines

Cambodia

PNG

Mongolia

Laos

Timor-Leste

China Access

Access levels remain low in Indonesia, Cambodia, Laos, Timor Leste, PNG


Major Issues/Challenges

• Manage energy demand growth and increase energy efficiency• Improve the energy sector's ability to attract investment• Mitigate environmental impact of energy sector • Scale up investments for increasing access to modern energy services

The Bank Group’s commitments (EAP Region) 2008

$618.5m active Bank lending portfolio, representing 53% of the Bank’s climate change portfolio

China dominates the EAP climate change portfolio with emphasis on energy efficiency and renewable energy

Bank Climate Change Lending Portfolio by Regions as of Jan, 2008

AFR12%

EAP53%

SAR18%

LCS2%

ECA15%


EAP has the Largest GEF and CF Portfolios among Regions…

AFR7%

SAR4%

MNA11%

LAC29%

ECA12%

EAP37%

World Bank GEF Climate Change Portfolio by Regions GEF:

$184m GEF grant portfolio, 74% in China Emphasis on energy efficiency, renewable energy, clean technologies, more recently urban transport and adaptation

Carbon Finance:73% of Bank CF portfolio by volume, China alone is 70% Focus on energy efficiency in power and industry, industrial gas emission reduction, waste management, reforestation

China, 70%

LCR, 9%

ECA, 8%

MNA, 2%

AFR, 5%

SAR, 3%

Other EAP3%

World Bank Carbon Finance Portfolio by Regions based on volume of emission reductions


13 EE projects and 5 New RE projects in the EAP region in FY2008

The EAP has the largest World Bank RE and EE Commitments in FY2008


Vietnam

Power investment framework; power generation, T&D, GMS

Gas T&D

Rural power

Mongolia, Laos, Cambodia

Power transmission for GMS (Cam, Laos); financing for generation; hydro (Laos); system rehab, commercialization

Rural power; biomass

Heat service/access(MN)

Oil product procurement

Indonesia

Power T&D; power investment framework

Mainstream CDM; gas T&D; geothermal

Rural access (incl. renewables); biomass

Philippines

Power restructuring, investment framework

Rural power distribution efficiency

Pacific Islands

Power generation (TL); commercialization


Oil import security

China

Energy sustainability

Power transmission; regulation

Environmental cleaning, clean coal, reform of coal mining

Gas T&D, renewablesscale-up (incl hydro)

Power, heat efficiency

Vietnam

Power investment framework; power generation, T&D, GMS

Gas T&D

Rural power

Mongolia, Laos, Cambodia

Power transmission for GMS (Cam, Laos); financing for generation; hydro (Laos); system rehab, commercialization


Heat service/access(MN)

Oil product procurement

Indonesia

Power T&D; power investment framework

Mainstream CDM; gas T&D; geothermal

Rural access (incl. renewables); biomass

Philippines

Power restructuring, investment framework

Rural power distribution efficiency

Pacific Islands

Power generation (TL); commercialization


Oil import security

China

Energy sustainability

Power transmission; regulation

Environmental cleaning, clean coal, reform of coal mining

Gas T&D, renewablesscale-up (incl hydro)

Power, heat efficiency


Country focus

China• Renewable energy• Efficiency • Urban heating & gas

(multi-sector)• Desulfurization• Coal sector

restructuring• Long-term energy

sustainability (AAA)

Vietnam• Power generation

(hydro, gas, coal)• Power transmission

& distribution • Rural electrification• Private

participation strategy for power sector (AAA)

Indonesia• Rural

electrification• Power

transmission & distribution

• Risk sharing framework for power generation investments (AAA)


Cambodia/Lao PDR/Mongolia

• Power sector financing strategies

• System rehabilitation & commercialization

• Rural electrification • GMS (Cam, Lao)• Heat (Mon)

Pacific Islands

• Capacity building• System

rehabilitation & commercialization

• Rural electrification• Hydro

Middle-income Countries

• Regional energy trade

• CDM operations• Knowledge broker

role


2. ASTAE FY08 - Implementation Highlights

Country Project Name Energy Type

Financing Source

RE or EE component Financing (US$ million)

Indonesia Geothermal Power Generation Development

Geothermal

GEF 4

China Energy Efficiency Financing Project EE IBRD / GEF

IBRD – 200GEF – 13.5

China Liaoning Third Medium Cities Infrastructure

EE IBRD 191

Vietnam Rural Distribution Project Access IDA 55


ASTAE Supported Activities in FY08

East Asia and Pacific Energy Flagship Study

Cambodia, China, Indonesia, Lao PDR, Mongolia,

Philippines, Thailand, Vietnam

Pacific Islands Sustainable Energy Financing Project

Fiji, Marshall Islands, Papua New Guinea, Solomon Islands, Vanuatu

VietnamRenewable Energy (REDP) Rural electrification (RE2)Energy Efficiency (SEIER / DSM)

ChinaRenewables / REDP and CRESPEfficiency / EE Financing and HeatReforms


MongoliaRural electrification / Renewable Energy / Distribution /Electricity Pricing / EE in Power Sector

Timor LesteGas Seep Harvesting Project / Energy ServicesDelivery project

Fiji / Solomon Islands Strategic Master Plan for Biomass DevelopmentSustainable Energy FinancingSupport to guarantees for Energy Enterprises (SI)

Cambodia / Lao PDR /Thailand / IndonesiaRural electrification / ImprovedCook stoves / (Cambodia) /Sustainable Energy Polices (Thailand)

PhilippinesBurgos Wind Farm


3- ASTAE Supported Activities in FY08-FY09

VietnamImplementation Support to DSM and REDP ProjectsImpact Studies of Rural Electrification / Documentary and Conference Material

MongoliaEnergy Efficiency Heating in the periphery of Ulan Bator

Pacific IslandsWind Resources Maps for Pacific IslandsPNG and Fiji Pro-Poor Sub-5WSolomon Islands Rural Electrification and Renewable Energy Solomon Islands Tina Small HydroTonga Renewable Energy Development

ChinaImplementation Support to CRESP and REDP Fiscal policies and sector regulations / small coal-fired power plants phase-outSupport to heat reform / Tianjin Municipality


IndonesiaPreparation Support to WB investment project Carbon Finance concept developmentImplementation Support GEF project / policy

IndiaEnergy Efficiency in Small & Medium Enterprise, implemented by the South Asia region

ESMAP Regional Block Grant Supported Activities in FY09

RegionalGreater Mekong Sub-region Power Trade

ChinaRenewable Energy Targets / Assessment

ChinaHeat regulations, North East

ChinaPower Dispatch Energy Efficiency Improvement

VietnamGas Master plan II


4. Indicators 2008-2009

1- Households with New & Improved Energy Access

2- Renewable Electricity Generation

3- Energy Savings as a Result of Efficiency Improvements

4- Avoided Greenhouse Gas Emissions


Proposed additional indicators:

•Energy Poverty / Gender Impacts

•Climate Change Adaptation indicators

•Impact of regional activities


5- Business Plan 2009-2012

Scaling-up Sustainable Energy Development

Acce

ss

Effici

ency

Renewable Energy

Sustainable energy options include:

• Energy Efficiency• Renewable Energy• Non-Renewable Energy Poverty Reduction Options

Add Climate Change Mitigation and Energy Poverty ?


ASTAESECTORAL WORK

Access

Energy Efficiency

Renewable Energy

CROSS-SECTORAL IMPACTS

Innovative Investment Delivery Mechanisms

Development of Institutional and Regulatory Frameworks

Training and Knowledge Sharing

Clean Development / Mitigation Window?


Innovative Investment Delivery Mechanisms

Institutional and Regulatory Frameworks

Training and Knowledge Sharing

Vietnam: structuring on-lending funds for renewable energy development

China: support to developing on-lending guidelines for energy efficiency project financing by Chinese commercial banks

Pacific Islands: provision of risk guarantees to leverage private sector investment in renewable energy

China: support to the development of the Chinese Renewable Energy Law

Thailand: scenarios for sustainable energy policies

China/North-East: support to the development of heat pricing policies

Mongolia: development of electricity distribution regulations

Training seminars for officials and policy makers

Regional workshops

Knowledge products

Technical Guides

Atlases

Video products


Topics for Discussion

Establish ASTAE as a Multi-Donor Trust Fund

Strengthen project impact monitoring, social / economic surveys / Develop qualitative - in addition to quantitative - indicators

Expand ASTAE Funds to include more Recipient Executed (investment) activities

Need to maintain strong activity in China –> identify new funds

Re-engage South Asia (one activity financed in India – but Bank execution only)


6. Funding Status & Staffing

During FY08-FY09 the largest part of ASTAE funding came from commitments by the Netherlands, representing a total allocation of US$7.4 million for calendar years 2006 to 2009.

The first tranche of a funding commitment of US$ 2 million by the Swedish International Development Agency (SIDA) was received in FY07, the second in FY08. This funding expires in 2010.

Additional commitments were made by the Australian Agency for International Development (Aus AID) to fund projects in Cambodia and in Laos, partly through ASTAE, partly through co-financing to set-up a Mekong Energy Fund.

Proposed GON funding for 2010-2012 is focused on Renewable Energy.

Further resources will be required in 2009 and beyond.

New resources to cover increasing demand for ASTAE activities, in Vietnam and China in particular, and to cover needs for energy efficiency development.


ASTAE Management Structure

ASTAE Manager Sector Manager EASTETAG

ASTAE Coordinator Donor-Funded Bank Staff

Sr. Budget Administrator Part-time Bank Staff

International HireDC-Based New Staff FY08

Local HireSydney BasedNew Staff FY08

Local HireBeijing BasedNew Staff FY08

Consultants


Additional staff needs for FY10-FY12

DC based:

Renewable Energy Specialist / Coordination of Recipient Executed Activities

Trust Funds Specialist

Communications Specialist

Country based:

ASTAE funded staff, Indonesia


ASTAE Donor Priorities FY09-FY12

Government of The Netherlands

Renewable EnergyFragile states

Sweden SIDA

Regional ActivitiesVietnam, China, Indonesia (India)

Aus AID

Cooperation on Climate Adaptation FundsMekong Area: Vietnam, Lao, CambodiaIndonesiaTimor Leste


Thank you!

Frederic [email protected]

astae

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