Public Financing for the Energy Sector (Fossil Fuel Extraction & Burning) in South Asia, East Asia & the Pacific since 1992
Posted on December 12 2003 |
Prepared by Liam Phelan, Sustainable Energy & Economy Network (SEEN). Derived from SEEN’s database, accessible at ww.seen.org.
December 2003
Introduction
Identifiable levels of public financing originating in industrialised countries for the energy sector in Asia/Pacific over the period since 1992 have been massive. This collection and analysis identifies $US30b of public support for the energy sector in South Asia, East Asia and the Pacific since that year. This collection is derived from SEEN’s database which includes details of verifiable financing from pubic institutions for fossil fuels. The extremely limited support for renewables is also included. Figures for some institutions are complete. For several institutions figures are not complete, limited to financing for the energy sector that can be verified. As such, the intervention of some agencies in the power sector in the countries of Asia/Pacific may be higher. In particular it is likely that the Japanese Bank for International Cooperation is a much bigger player than the available figures indicate.
Just over half the total financing ($US15.7b, 52%) originated with Multilateral Development Banks – the World Bank Group and the Asian Development Bank. The remainder ($US14.2b) originated with Export Credit Agencies, principally the US’ Export-Import Bank and the Overseas Private Investment Corporation. A negligible amount ($US6m) of bilateral financing from the US is also included.
Public finance for privatisation of power sectors
Multilateral Development Banks (and bilateral aid)
Multilateral development banks and bilateral aid programs push governments towards privatisation in a number of ways including production of ‘knowledge’ in the form or reports, policy documents, etc that trumpet the merit of privatisation and provision of training programs for bureaucrats to ensure the message is heard. One other way is lending for policy and institutional reform. Two examples in this collection are for explicit power sector privatisation projects:
• the ‘Indonesia Power Sector Privatization’ project, financed by the Asian Development Bank, USAID, possibly Japanese ECAs and with proposed support from German ECAs.
• the ‘Papua New Guinea’ Petroleum Sector’ project, financed by the World Bank.
Export Credit Agencies
After development banks lay the groundwork, export credit agencies provide finance for corporate players to get involved in newly privatised power sectors. Examples in this collection include a number of Independent Power Producers (IPPs) in the Philippines. The collective impact of the influx of IPPs in the Philippines has had dramatically negative social impact: on the one hand the effective bankruptcy of the state-owned power company forced to buy power generation capacity from the IPPs at excessive rates; on the other increased rates for consumers, including levies towards covering the debt crippling the state-owned power company.
Presentation of the data
The data is presented in two parts. Part one provides a summary of financing for the region. It’s broken down by institution and by country. Part two provides project level detail for each country.
Scope of the data
Countries
The data collected here covers most countries in South Asia, East Asia and some Pacific Island countries. These are:
• Bangaldesh, Bhutan, Cambodia, China, India, Indonesia, Malaysia, Pakistan, Papua New Guinea, Philippines, Sri Lanka, Thailand, Vietnam
Types of infrastructure projects and reform programs
Financing for the full scale of the fossil fuel energy sector is covered, from coal mining and oil/gas drilling through to power plants and related infrastructure. Some ‘sectoral reform’ style projects are also included. Renewable energy (wind, solar, thermal, biomass and small scale hydro) and energy efficiency measures are also included.
Status of financing:
Projects are categorised the following way:
• Approved: the board of the financing institution has made a decision to make available support for the project.
• Approved (cancelled): the financing institution made a decision to support the project but then withdrew that support
• Approved (completed): the financing institution has completed its support for the project
• Approved (inactive): the financing institution has approved support for the project but the project is not currently being pursued
• Approved (no contract issued): the financing institution has approved support for the project but has yet to provide the support
• Proposed: the financing institution has been approached to provide support for the project but has yet to make a decision
• [BLANK]: the status of the financing is unknown
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