The government of New Zealand added a $25-million fund to Asian Development Bank (ADB) to help Southeast Asia quickly shift from coal to clean and renewable energy.

New Zealand Prime Minister Christopher Luxon announced this on Friday in a meeting with the multinational bank’s Philippine office in Mandaluyong City, the ADB said.

The fund will support projects under ADB’s Energy Transition Mechanism or ETM program.

Vital climate change tool

“As the climate bank for Asia and the Pacific, we believe ETM has the potential to be one of the largest carbon reduction programs in the world and a vital tool in the battle against climate change. Support from partners such as New Zealand is critical as we expand ETM across our region,” ADB president Masatsugu Asakawa said.

ADB said Japan and Germany had also contributed funds to the ETM program.

Through the program, the ADB and its partners are able to conduct feasibility studies on clean, renewable energy sources as they aim to shut down or repurpose coal and other fossil fuel plants in mitigating climate change.

$97-B economic loss

Studies by the Intergovernmental Panel on Climate Change (IPCC) show Southeast Asia could face an economic loss of over $97 billion in this decade if climate measures are delayed.

In the Philippines, the IPCC says agricultural production might drop by 15 to 20 percent by 2050 due to climate change. It adds the worsening drought could hurt 75 percent of Filipino farmers.

“New Zealand’s contribution to the ETM supports Southeast Asia’s ambition for an accelerated transition from fossil fuels to clean energy, while ensuring this transformation is fair and equitable,” Luxon said.

The Department of Energy plans to increase the share of renewable energy to 35 percent of the entire power mix of the Philippines by 2030 and by 50 percent by 2040.