ADB, Standard Chartered Bank Promote Private Sector Investment in Energy-Efficient Projects in PRC 

ADB has selected Standard Chartered Bank as the first partner financial institution in the pilot program that will initially target energy efficiency programs for buildings.

The Energy Efficiency Multi-Project Financing Program is ADB’s first credit guarantee to mobilize commercial financing in PRC. An agreement between ADB and Standard Chartered was signed today.

Energy demand in PRC, the world’s second-largest energy consumer and one of its largest emitters of greenhouse gasses, is growing rapidly to support its economic growth. This program will enhance access to domestic finance by a large number of energy end users in PRC for more efficient energy use in existing and new buildings.

The program will support the retrofitting of existing buildings, typically leading to energy savings of 20%-40%. The program will also support energy efficient “green buildings”.  Given PRC’s rapid urbanization, energy efficiency of buildings will have long-lasting and large cumulative effects of reducing energy use and greenhouse gas emissions.

ADB is working with financial institutions, like Standard Chartered, and energy management companies. In this instance, ADB will share the credit risk with Standard Chartered, which is committed to promote and finance energy-efficient projects worldwide. The partner energy management company identifies and assesses energy saving potential.

“ADB has worked to develop and structure the program effectively as a private-sector transaction in order to make the program replicable with private-sector investment not only in PRC but also in other regions. We are very pleased to have a credible international financial institution such as Standard Chartered Bank to participate in the program,” said S. Chander, Deputy Director General of ADB’s Private Sector Operations Department.

Jaspal Singh Bindra, Standard Chartered’s Chief Executive for Asia, said: “Standard Chartered is delighted to be the first bank to partner with ADB on the Energy Efficiency Multi-Project Financing Program. Asia is a core market for us and ADB, and we appreciate our partnership throughout the region. This project demonstrates our commitment to growing our business and to deepening our environmental sustainability agenda in China, where we have been active for 150 years.”

The Energy Efficiency Multi-Project Financing Program was initiated by ADB as part of its Energy Efficiency Initiative, under which ADB aims to expand its operations in energy efficiency and clean energy to at least US$1 billion a year.

For Standard Chartered, many markets where the bank operates have fast-growing economies in which exponentially increasing energy needs lead to increasing greenhouse gas emissions. In 2007, Standard Chartered committed to the Clinton Global Initiative to advise and provide finance for new renewable and clean energy projects with values of US$8 billion-US$10 billion over the next five years.

ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 67 members – 48 from the region.  In 2007, it approved US$10.1 billion of loans, US$673 million of grant projects, and technical assistance amounting to US$243 million.