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| Paris alignment | Reasoning |
|---|---|
| Some progress | While the AIIB acknowledges the importance of energy access and includes it as a guiding principle in its Energy Sector Strategy, it falls short of best practice in implementing this strategic priority. Specifically, the Bank has not adopted any clear minimum working definition of access across its operations or committed to any specific energy access target (beyond a general commitment to SDG7). Moreover, despite indications that the Bank intends to consider energy access within its Results Monitoring Framework, there is no publicly available update on this reporting to enable portfolio level tracking of progress. |
| Alignment and reasoning | |
| Energy Access Target | The AIIB’s Energy Sector Strategy recognises different tiers of energy access, but falls short of adopting or establishing a minimum working definition (or multi-tier framework) to be applied across the Bank’s own operations. |
| Minimum Definition of Access | The Results Management Framework annexed to the AfDB’s Strategy for The New Deal on Energy for Africa 2016–2025, states that measurement of access “will be refined in due course to reflect Tier 3 [according to the Multi-Tier Framework] and above for both electricity and cooking”. However, it is unclear if this is a working definition of energy access being applied consistently across operations. |
| % of Energy Financing Dedicated to Energy Access | The proportion of total AIIB energy finance dedicated to access has fluctuated significantly since the Bank’s inception, ranging from no energy access financing in two years of the sample, to a high of 61% in 2017. |
| Is Progress Monitored | The AIIB monitors energy access at the project level through several indicators set out by its Results Monitoring Framework. However, these indicators notably lack specific reference to clean or modern energy access. The project level reporting does not appear to be aggregated and reported at the portfolio level. However, the Bank does report on SDG7 progress in its annual Sustainable Development Bonds Impact Report. |
| Progress against Metrics | As the Results Monitoring Framework is seemingly only disclosed at project level, there is no portfolio level data regarding progress on energy access. According to the 2023 AIIB Sustainable Development Bonds Impact Report, 43% of projects AIIB financed contributed to SDG7, down from 45.24% in 2022. |
Energy access target and minimum definition of access
The AIIB’s Energy Sector Strategy identifies promoting energy access and energy security as a guiding principle, committing to accelerate “the just transition towards secure, affordable, and sustainable energy access for all”. Consequently, the strategy refers to the Bank supporting universal access to affordable and reliable modern energy services by 2030, in line with SDG7 (universal access to clean, affordable, reliable energy by 2030). However, the strategy does not set a specific, measurable target for the AIIB’s contribution through its operations in this regard. The strategy also notes the slow improvement in increasing access to clean cooking fuels, but does not commit the AIIB to any specific action or target as part of tackling this.
In terms of establishing a minimum definition of access, the AIIB acknowledges different tiers of energy access with reference to a graphic showing “Access to Modern Energy Services”. This recognises the differing levels of basic human needs, productive uses, and modern society needs. The strategy also refers to the level of access to “modern” energy in Asia, citing power systems that do not meet standards to allow for an improvement in living standards, and stressing the importance of affordability of energy. The AIIB’s Environmental and Social Framework also stresses the importance of affordable energy action, emphasising in particular securing access to affordable energy for vulnerable or disabled persons and disadvantaged groups.
However, despite these indications of a multi-faceted understanding of energy access, the Bank has not explicitly adopted or established a working minimum definition (or multi-tier framework) for how it measures access in its own operations (such as the Multi-Tier Framework developed by SEforAll and the World Bank Group).
Energy access progress
The AIIB monitors progress on energy access based on the Results Monitoring Framework, as set out in its Energy Sector Strategy. Energy access is monitored against five outcome indicators: (1) total generation capacity added or upgraded, (2) total transmission and distribution lines/pipelines added or upgraded, (3) total transmission and distribution capacity added or upgraded, (4) total electricity story capacity financed, and (5) number of households provided with new or improved access to energy. Notably, these indicators do not feature any explicit consideration of access provided to clean or modern energy, or clean cooking fuels. These indicators are reported on at project level as part of disclosure of project documentation. However, it is unclear whether they are aggregated or reported at portfolio level.
Analysis of the AIIB’s energy operations, as recorded as part of Oil Change International’s Public Finance for Energy Database reveals that the proportion of total energy finance dedicated towards energy access has fluctuated significantly since the Bank’s inception. Notably, both absolute and relative finance for energy access peaked in 2017, with 61% of total energy financing dedicated to access. Only a very small amount of energy access finance (USD 1 million or approx. 0.001% of total energy finance) was recorded in 2018, before a steady increase in absolute terms through to a second (absolute) peak 2021. This was then once again followed by no energy access finance having been recorded in 2022.
The variation in the proportion of energy sector financing dedicated to access is predominantly due to significant annual changes in total energy approvals, with smaller variations in the absolute amount dedicated to energy access.
Separately, the AIIB reports on the percentage of approved projects that contribute to SDG7 as part of its annual AIIB Sustainable Development Bonds Impact Report. The 2023 report revealed that 43% of projects the AIIB financed contributed to SDG7, marginally down from 45.24% in 2022.
Recommendations:
- The AIIB should establish a clear working definition of energy access to enable more comparable and detailed monitoring of its progress. The Bank could use the Multi-Tier Framework to measure access. The AIIB should subsequently consider setting an explicit, quantifiable, time-bound target for its contribution to energy access as part of its energy sector strategy. This would mirror the best practice of peer institutions such as the AfDB, which has committed to an ambitious overarching goal of supporting universal energy access across Africa by 2025, along with four specific quantifiable access targets to achieve this. As part of this, the AIIB could explicitly commit to supporting the SE4ALL 2030 universal access goal.
- The AIIB should utilise its existing project level Results Monitoring Framework to monitor and publicly disclose portfolio level aggregated energy access data. In doing so the Bank could further enhance the framework by expanding the list of indicators to facilitate dedicated tracking of access provided to clean and/or modern energy, as well as clean cooking fuels.
Last Update: April 2025