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Ministerial meeting backs need to strive for Paris Agreement

Highlights

Diverse carbon neutrality pathways expected for each country

'Essential' to establish framework for transition finance: ministers

Japan already proposes $10 bil support for ASEAN energy transition

Ministers and other top officials from 22 countries in Asia, the Middle East and North America have agreed on the need to make efforts to achieve the earliest possible global carbon neutrality in pursuit of the Paris Agreement, just weeks ahead of the COP26.

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The consensus was reached Oct. 4 during the first Asia Green Growth Partnership Ministerial Meeting (AGGPM), which was launched by Japan, to consider realistic energy transitions toward carbon neutrality and measures to achieve green growth in Asia. The 2015 Paris Agreement aims to limit global temperature increases to no more than 2 C, preferably 1.5 C, from pre-industrial levels.

"We recognized the urgency of addressing climate change as a common global challenge, in light of recent global events such as disasters caused by climate change, and acknowledged the need for all countries to make efforts and contributions to achieve global carbon neutrality in the earliest possible timing in pursuing the goals of the Paris Agreement," according to the chair's summary of the meeting.

It came just weeks ahead of the 26th UN Climate Change Conference of the Parties, or COP26, in Glasgow scheduled for Oct. 31-Nov. 12.

"We agreed that there is no single pathway to achieve carbon neutrality, but rather there are diverse pathways for each country," according to the chair's summary.

The meeting participated by most ASEAN countries along with India, Bangladesh, US, Australia, Saudi Arabia, the UAE, Qatar, Iran, Iraq and Kuwait comes at a time when many countries are striving for carbon neutrality via measures including energy transition but at their own pace with their economic growth.

"We will need to ensure that the social and economic impacts of clean energy transitions are at the heart of policymaking and energy security is safeguarded," Fatih Birol, the executive director of the International Energy Agency, said in a prerecorded video address ahead of AGGPM. "This is particularly true in Asia as Asia continues to shape many aspects of global economic and energy outlook," Birol said.

Transition finance

Nations face increasing pressure from the financial sector to restrict funding of fossil fuel projects, and ministers said they recognized the need of "establishing mechanisms to attract investment and funding for various lower emissions and energy efficiency technologies and projects, positioned on the pathways outlined by each country, in order to achieve energy transitions in Asia," according to the chair's summary.

It also noted it is "essential to establish a framework that financially supports technologies and projects contributing to energy transitions" and explore the concept of the Asia Transition Finance by the Asia Transition Finance Study Group set by private financial institutions.

The ATF Study Group, which is participated by Asian and global commercial banks, aims to provide practical guidelines for transition finance and to formulate recommendations to policy makers, with an eye to release an interim summary by March 2022 and final recommendations by October 2022.

In June, Japan offered ASEAN energy ministers $10 billion in public finance for renewables and LNG projects, as part of a package of measures aimed at helping the group of 10 Southeastern Asian economies accelerate their moves toward energy transition.

Japan's package of actions, dubbed the Asia Energy Transition Initiative (AETI) and set to include a wide range of support measures for energy transition in ASEAN countries -- Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam -- was welcomed at AGGPM.

As part of the package, Japan has proposed to help ASEAN members formulate individual roadmaps for energy transition toward carbon neutrality, with regional and individual carbon neutrality outlooks for 2050, 2060 and 2070 provisionally calculated by the Economic Research Institute for ASEAN and East Asia, or ERIA.

Japan's proposed energy transition finance idea would provide ASEAN countries up to $10 billion in financial support for projects that form part of their carbon neutrality roadmaps, following individual declaration of carbon neutrality.

The $10 billion financial support aims to help ASEAN countries introduce renewables and energy conservation as well as LNG to transit away from coal. Japan also suggested that ASEAN countries could share its technological development and deployment support for offshore wind power generation, fuel ammonia and hydrogen, among other fields.