How “Sustainable” Finance from the Asian Development Bank is Fueling Indonesia’s Coal Expansion

A report by Inclusive Development International and partners alleging that a $600 million loan from the Asian Development Bank (ADB) to Indonesia's state-run utility PLN may be fueling coal expansion, specifically the Java 9 & 10 project, despite the bank's public commitments to climate finance and a 'no-new-coal' policy.

• The Asian Development Bank (ADB) provided a $600 million loan in December 2021 to Perusahaan Listrik Negara (PLN), Indonesia's state-run electricity utility, which the report claims can be used to fund new coal power plants.
• The loan agreement lacks a specific 'no-coal' clause and defines 'eligible expenditures' as those under 'PLN’s Program,' which refers to the RUPTL 2021-2030 business plan that includes the Java 9 & 10 expansion and over a dozen other coal projects.
• The ADB denies that the loan funds coal, stating that eligible expenditures are restricted to power grid rehabilitation, clean energy promotion, and institutional capacity strengthening.
• The report argues that the loan is practically unenforceable because funds are disbursed into PLN's general bank account rather than a segregated account, making it impossible to trace the end use of the money.
• The Suralaya Power Station in Banten Province is described as the dirtiest industrial complex in Southeast Asia, with pollution causing an estimated 2,500 deaths per year in Indonesia.
• The Java 9 & 10 expansion of the Suralaya complex, which began construction in 2021, is projected by Greenpeace to cause between 2,400 and 7,300 premature deaths over its 30-year lifespan.
• Residents of western Java filed a complaint with the World Bank Group's International Finance Corporation (IFC) regarding a $2.6 billion syndicated loan involving PT Hana Bank Indonesia for the Java 9 & 10 project.

APA

Roasa, D. (2024). How “Sustainable” Finance from the Asian Development Bank is Fueling Indonesia’s Coal Expansion. Trend Asia. https://trendasia.org/wp-content/uploads/2024/04/7636-IDI-Report-Smog-and-Mirrors-Digital-FA-3.pdf

Chicago

Roasa, Dustin. How “Sustainable” Finance from the Asian Development Bank is Fueling Indonesia’s Coal Expansion. Trend Asia, 2024. https://trendasia.org/wp-content/uploads/2024/04/7636-IDI-Report-Smog-and-Mirrors-Digital-FA-3.pdf.

Wikipedia

{{cite report |last1=Roasa |first1=Dustin |title=How “Sustainable” Finance from the Asian Development Bank is Fueling Indonesia’s Coal Expansion |publisher=Trend Asia |date=April 2024 |url=https://trendasia.org/wp-content/uploads/2024/04/7636-IDI-Report-Smog-and-Mirrors-Digital-FA-3.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{roasa2024how, author = {Roasa, Dustin}, title = {{How “Sustainable” Finance from the Asian Development Bank is Fueling Indonesia’s Coal Expansion}}, institution = {Trend Asia}, year = {2024}, month = apr, url = {https://trendasia.org/wp-content/uploads/2024/04/7636-IDI-Report-Smog-and-Mirrors-Digital-FA-3.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }