AIIB’s Sustainable Energy

Strategy and Financing

David Morgado, Senior Energy Policy Specialist

Asia Clean Energy Forum, 18th June 2019
DISCLAIMER
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As at June 1, 2019 unless otherwise stated.

ABOUT AIIB
Asian Infrastructure Investment Bank

Who we are Our mission Credit strength

Multilateral Development Bank To improve economic and social Strong support from diversified
founded to bring countries together development in Asia and beyond global shareholder base.
to address Asia’s daunting USD100 billion capital stock with
infrastructure funding gap 20% assigned to paid-in capital.
estimated at 26 trillion USD through Prudent risk management and
20301. financial policies. AAA/Aaa/AAA
rating with stable outlook.

Lean, with a small Clean, an ethical Green, an institution

Its core values are: efficient management organization with built on respect for
team and highly zero tolerance for the environment.
skilled staff. corruption.

1Source: “Meeting Asia’s Infrastructure Needs”, ADB 2017

SHAREHOLDERS
97 approved members

The bank…will help to

mobilize much needed
additional resources from
inside and outside Asia…
and will complement the
existing multilateral
development banks.

Articles of Agreement
Members Members Prospective Prospective
Regional Non-Regional Regional Non-Regional
Afghanistan Iran Qatar
Austria Madagascar Armenia Algeria Libya
Australia Israel Russia
Belarus Malta Cook Islands Argentina Morocco
Azerbaijan Jordan Samoa
Canada Netherlands Kuwait* Belgium Peru
* Prospective founding member: These are Bahrain Kazakhstan Saudi Arabia
Denmark Norway Lebanon Bolivia Serbia
prospective members who were original Bangladesh Korea Singapore
Egypt Poland Papua New Guinea Brazil* South Africa*
signatories to the Articles of Agreement in Brunei Kyrgyz Republic Sri Lanka
Ethiopia Portugal Tonga Chile Togo
June 2015. Countries or territories who Darussalam Lao PDR Tajikistan
Finland Romania Côte d’Ivoire Tunisia
sought membership after that date are Cambodia Malaysia Thailand
France Spain Ecuador Uruguay
simply called prospective members. All China Maldives Timor-Leste
Germany Sudan Ghana Venezuela
prospective members have been approved Cyprus Mongolia Turkey
Hungary Sweden Guinea
by the Board of Governors but have not yet Fiji Myanmar UAE
Iceland Switzerland Greece
met the full requirements of membership. Georgia Nepal Uzbekistan
Ireland United Kingdom Kenya
Hong Kong, New Zealand Vanuatu
Italy
China Oman Vietnam
Luxembourg
India Pakistan
Indonesia Philippines
AIIB’S THEMATIC PRIORITIES
We approach lending, developing our business lines and selecting our projects based
on three thematic priorities
Sustainable Infrastructure
Promoting green infrastructure and
supporting members to meet their
environmental and development goals,
especially their commitments under
the Paris Agreement and the United
Nations’ Sustainable Development Goals.
Cross-border Connectivity
Prioritizing cross-border infrastructure,
ranging from roads and rail to ports,
airports, energy pipelines and telecoms.
Private Capital Mobilization
Devising innovative solutions that mobilize
private capital, in partnership with other
MDBs, governments, private financiers and
other partners. AIIB’s presence on
cofinancings helps spread risk across the
MDB and private sector communities, and
can help to crowd in private sector capital.
AIIB ENERGY STRATEGY
The framework, principles, and operational modalities to guide AIIB’s energy sector engagement

Support member countries to:

AIIB’s Guiding Principles
• develop and improve their energy infrastructure,
1. Promote Energy Access and Security.
• increase energy access,
2. Realize Energy Efficiency Potential.
• transition to low carbon energy mix and
3. Reduce the Carbon Intensity of Energy
• help meet their international commitments
Supply.

Recognizes the energy challenges of the region and builds 4. Manage Local and Regional Pollution.
on the principles of the:
5. Catalyze Private Capital.
• Sustainable Energy for All
6. Promote Regional Cooperation and
• 2030 Agenda for Sustainable Development Connectivity.
• Paris Agreement
AIIB ENERGY INVESTMENT OPERATIONS
June 7, 2019

Approved Projects by Sector Approved Projects by Energy Sub-Sector

ICT, 1% Renewable
Urban, 10% Others, 1%
Energy, 24%

Banking & Electricity

Finance, 14% Energy, 35% Transmission &
Distribution,
19%

Water & Gas Power

Waste, 16% Plants, 3%
Gas
Transmission &
Distribution,
54%
Transport, 23%

8.0 billion USD 2.8 billion USD

APPROVED ENERGY PROJECTS
June 7, 2019
• Azerbaijan Trans Anatolian Natural Gas Pipeline Project
• Bangladesh Bhola IPP
• Bangladesh Distribution System Upgrade & Expansion Project
• Bangladesh Natural Gas Infrastructure & Efficiency Improvement Project
• Bangladesh Power System Upgrade and Expansion Project
• China Beijing Air Quality Improvement & Coal Replacement Project
• Egypt Round II Solar PV Feed-in Tariffs Program
• India Andhra Pradesh 24x7 – Power For All
• India Transmission System Strengthening Project
• Myanmar Myingyan Gas Power Plant Project
• Pakistan Tarbela 5 Hydropower Extension Project
• Tajikistan Nurek Hydropower Rehabilitation Project, Phase I
• Turkey Tuz Golu Gas Storage Expansion Project
• Nepal Upper Trishuli-1 Hydropower Project
AIIB ESG ENHANCED CREDIT PORTFOLIO
• 500 million USD investment in corporate, green
and quasi-sovereign bonds including:
• Renewables
• Energy Efficiency
• Power Generation
• Transmission and Distribution

• Aligned with Environment, Social and Governance

(ESG) Investment Principles
• Aim:
• develop infrastructure as an asset class,
• encourage investment in infra-related companies
• catalyze the development of ESG investing
strategies through AIIB ESG Market Initiative

• Encourage investors in Asia to move up the ESG

investment ladder
SUSTAINABLE ENERGY & INFRASTRUCTURE
ON-LENDING FACILITY
• Industrial Development Bank of Turkey (TSKB)
• Sovereign-backed loan facility
• 200 million USD
• Finance eligible sub-projects including:
• renewable energy – solar, small hydropower, wind,
geothermal and biomass
• energy efficiency

• Advantages:
• Aggregator with market knowledge
• Vast experience in renewable energy and energy
efficiency and with MDB’s high E&S requirements
• Providing long-term financing and reducing risks
• Potential replicability in other markets
THANK YOU.
LET’S CREATE TOMORROW.