Background

The coronavirus disease (COVID-19) has resulted in a severe global health and economic crisis but it also presents an opportunity for a green, sustainable, and resilient recovery. At the Asian Development Bank (ADB), we are supporting developing member countries (DMCs) in Asia and the Pacific as they struggle to first manage the direct health crisis and then prepare to address the economic impacts during the recovery phase due to reduced international travel and trade, along with contractions of domestic economies.

I have seen energy services play a vital role in fighting the COVID-19 pandemic. For instance, Asia and the Pacific energy needs have been met reliably during the pandemic despite many challenges, such as personnel shortages and travel restrictions. Thanks to dependable access to energy, hospitals can provide health services without power interruption, we as professionals can work from home to continue business activities, and students can study remotely with digital technology. While this is a positive reflection of past energy sector development, ADB remains focused on continued development progress, reinforcing the need for modern energy to meet the United Nations’ Sustainable Development Goals (SDGs) by focusing support on technologies aligned with the reduction of greenhouse gas emissions as committed under the Paris Agreement.

Recovery from COVID-19 through Rejuvenation and Resilience

As I watch activity shift from initial emergency response to economic recovery, I believe a reinvigorated development effort requires a reliable supply of sustainable energy to support economic activity and essential societal services. In tandem, investments and the creation of jobs can provide economic stimulus directly and be framed as “Recovery through Rejuvenation and Resilience” that rests on the following interrelated four pillars: 

1. Enhancing sustainable energy services;
2. Improving energy sector resilience and security;
3. Accelerating energy access to the poor and vulnerable; and
4. Using advanced technology.

Enhancing sustainable energy services is an ongoing development imperative to address high levels of unmet demand or high annual outage levels of power supply, as well as regional disparities for heating and cooling that still exist within countries. Renewable energy deployments – especially for solar and wind – now can produce power that is lower in cost than coal and gas in many countries, providing the economic motivation to deploy these technologies to harvest indigenous renewable resources. Alongside the growth of renewable technology deployment, modern and robust electricity grids will also be needed to facilitate integration.

Improving energy sector resilience and security has been clearly identified as a need during the COVID-19 pandemic. Although energy systems have operated well so far, concerns of over-reliance on international access to skills and capabilities, technologies, and fuel resources have meant that those systems have been put at risk. Renewable energy technologies, when deployed and maintained with local staffing and local manufacturing where practical, create resilient energy generation that uses indigenous resources and creates jobs. Investments must ensure that infrastructure aligns with current and future climate policy and is not stranded to avoid wasted efforts and resources.

Accelerating energy access to the poor and vulnerable is key to responding to the pandemic. During recovery, stimulus money for pro-poor and pro-vulnerable tariff structures and energy infrastructure can be prioritized to support basic services and productive use of energy. Interventions that focus on small businesses, education, and health will be essential to support populations that have been cut off from overseas-based work opportunities due to COVID-19. This will ensure that the next generation does not fall behind in education while strengthening the health system to address pandemic-related and future health needs.  

Using advanced technology is essential to link the three above mentioned priorities. Remote management and payment systems can enable access to energy in last-mile applications essential for cold-chain infrastructure needed for vaccine deployment.  Automated metering infrastructure can reduce contact between people for billing purposes to help limit the spread of COVID-19 while reducing commercial losses that can be so damaging for utilities. Battery storage systems can increase the efficiency of system operation and support renewable integration.

Highlights of Successful ADB Projects Under Four Pillars

Throughout 2020, at ADB we have accelerated efforts to deliver on projects across these pillars. In Indonesia, we approved a $300 million loan to develop geothermal resources for renewable baseload power that will also support future wind and solar deployments. In Mongolia, the first utility-scale battery storage project valued at $110 million will strengthen the grid, supporting the integration of renewable energy and reducing reliance on coal for power generation. In the Meghalaya province in India, we are supporting a $166 million project that will not only strengthen and modernize the power distribution network but will also support pilot testing of gender- and socially-inclusive renewable mini-grid energy systems, which have the potential for future replication.

The Role of ADB to Support DMCs

ADB’s operations in the energy sector will continue to focus on acute needs as a result of the pandemic, deliver its existing pipeline of investments, and adjust existing projects to address any changes caused by COVID-19 within the respective DMCs. While the focus in 2020 has been on COVID-19, there remains a strong and compelling need for energy investments in developing countries with a long-term vision aligned with the Paris Agreement, SDGs, and ADB’s Strategy 2030. I believe COVID-19 has provided the motivation to find solutions that can meet both short- and long-term energy sector needs. Stakeholders must work together in order to ensure that projects support low-carbon development alongside broader societal recovery from the pandemic. The pillars highlighted above offer guidance for energy sector investments, showing the opportunity for a green recovery in meeting DMC development objectives. ADB’s energy sector programs will be at the forefront of these efforts, increasing its engagement across all development needs and delivering energy services in a truly sustainable manner.

Woochong Um is the Director-General of Asian Development Bank's Sustainable Development and Climate Change Department