DESCRIPTION
The Energy Transition Mechanism Partnership Trust Fund (ETMPTF) is a multiple-partner trust fund established in June 2022 to enable resource mobilization for the Energy Transition Mechanism (ETM) and allocation of support to related activities. The ETM is a transformative financing mechanism, which aims to catalyze public and private capital to accelerate the transition from carbon-intensive coal-based power plants to clean energy in the Asian Development Bank’s (ADB)’s developing member countries (DMCs). The ETMPTF aims to support the ETM activities for the early retirement of coal-based generation assets and the transition to clean energy in DMCs to reduce greenhouse gas emissions.
ETMPTF total fund amount is USD 81.5 million (with ongoing fundraising) including Germany’s EUR 30 million contribution, which is earmarked for projects and programs in Indonesia. The contribution is aimed at facilitating the transition to carbon-neutral energy sources through the energy transition mechanism (early coal retirement) and can support either direct investment in projects, or technical support for related activities.
The contribution is not intended for activities directly related to carbon capture and storage and the funds are restricted from supporting any activities related to the prospecting, exploration, and exploitation of fossil fuels (coal, oil, natural gas) and radioactive materials, as well as any infrastructure development or retrofitting projects that facilitate the use of these resources for energy production.
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KEY DELIVERABLES
To date, the ETMPTF has supported three projects, two which have included Indonesia:
● Enabling a Just Transition to Low-Carbon and Climate-Resilient Economies and Societies in Asia and the Pacific. This TA operationalizes the Just Transition Support Platform (JTSP), which aims to build the capacities of developing member countries (DMCs) to understand and strategically plan just transition in their respective countries. The ETMPTF financing supports JT activities in six countries, namely India, Indonesia, Kazakhstan, Pakistan, the Philippines, and Viet Nam. Support has commenced in Indonesia around the Cirebon 1 ETM transaction.
● Building Capacity for Low-Carbon Power Infrastructure Development. This TA will support Indonesia’s PLN in improving processes, practices, workforce competencies, and skills to shift the power system from fossil fuel to low-carbon electricity supply.
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| Modality | Financing Type | Financing Source | Financing Intermediary | Amount (Home Currency) | Amount (USD) | Part of JETP Pledge |
|---|---|---|---|---|---|---|
| Modality A | Grant / TA | IPG - Germany | IKI/Asian Development Bank Energy Transition Mechanism | EUR 30,000,000 | USD 32,100,000 | Yes |