Asian Infrastructure Investment Bank

Greenhouse gas accounting at project and portfolio level 

This page is part of the E3G Public Bank Climate Tracker Matrix, our tool to help you assess the Paris alignment of public banks, MDBs and DFIs.

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Paris alignmentReasoning
UnalignedPortfolio-level monitoring of greenhouse gas (GHG) emissions for energy sector only. No project-level reporting yet (although some projects in pipeline) and no targets.
Year startedInclusion threshold (CO2e/ year)Sectors  
covered 
Target 
2016 (energy sector only) so from the start of bank operations. No threshold set.Energy sector only at project and portfolio level. No target set. 

Explanation

The AIIB has a portfolio-level monitoring indicator of gross greenhouse gas emissions in tonnes of CO2e per year for its energy sector lending. It started this in 2016, shortly after it was founded, showing commitment in this area.  The AIIB has confirmed to E3G that it follows the harmonised IFI approach to GHG accounting. 

The AIIB has also committed to project-level assessments to determine “the impacts of the project on climate change, including emissions”. This implies that this would include not just absolute GHG emissions reduced but also emitted. The AIIB has confirmed that all projects with GHG emissions reductions disclose the GHG benefits, which is welcomed, and some projects include relative emissions reductions. However, analysis of project documents on the AIIB website shows that they do not appear to include quantifications of absolute emissions, so it is not clear if this commitment has been fully implemented yet. The AIIB has informed E3G that there are projects that implement this in their pipeline. 

The AIIB has not announced any GHG emissions targets for either specific sectors or for its full portfolio. As of July 2020, the AIIB has started systematically applying internal carbon pricing for new projects. E3G understands that AIIB draws on the High-Level Commission on Carbon Prices recommendations. 

The updated version of its energy strategy states that “all energy projects financed by the Bank will include [GHG] indicators in their results framework where applicable. Project level indicators will be aggregated across the Bank’s energy investment portfolio to monitor progress towards implementing the Energy Sector Strategy”. 

The AIIB transport strategy  states that “measuring greenhouse gas emissions of transport infrastructure is desirable but technically complex, and still faces methodological and practical challenges. AIIB will build such capacity over time and be informed by the lessons learned from other MDBs and ongoing development of methodologies.” This analysis will be updated further as AIIB updates its policy in this area. 

Finally, according to the AIIB’s 2019 Environmental and Social Framework “in order to support reporting on greenhouse gas emissions for implementation of the Paris Agreement, the AIIB may, at the client’s request, finance measures for the client to quantify and report to national authorities, in accordance with internationally recognized methodologies and good practice, direct and indirect emissions from Project-related facilities”. 

Recommendation: The AIIB should seek to copy the best practice from IDB in the area of transport sector GHG emissions. 

Recommendation: The AIIB should work to ensure that its common approach to the greenhouse gas accounting (GHG) of energy efficiency does not extend the lifespans and absolute emissions of fossil fuel assets.

Last Update: November 2020

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