The transition to renewable energy has given the Asian Development Bank (ADB) an excuse for rekindling a relationship with an old flame: mining. Under its ongoing energy policy review, the bank is looking to support transition minerals, which will be used to manufacture renewable energy technologies such as solar panels, wind turbines, and electronic vehicle batteries. Remarkably, loans for transition mining will form part of ADB’s climate finance portfolio.
But communities sitting on large reserves of transition minerals can see right through this sleight of hand.
According to a study, more than half of the world’s transition minerals can be found on or close to Indigenous and peasant lands. In the Philippines, 60 percent of mineral reserves are located in Indigenous lands. The ADB’s new program, Sustainable Critical Minerals and Clean Energy Technology Manufacturing (CM2CET), fits right into the Philippine government’s plans for transition mining.
The recent passage of Republic Act No. 12253, or the Enhanced Fiscal Regime for Large-Scale Metallic Mining Act, provides fiscal stability and incentives to investors by shifting from a revenue-based tax regime to a profit-based one. Tellingly, one of the maiden investments of the government’s Maharlika Sovereign Fund is in a mining project in Kalinga.
In the executive branch, the Department of Environment and Natural Resources will soon issue a department order on critical minerals, instead of supporting a more comprehensive policy reform such as the Alternative Minerals Management bill, which continues to gather dust in Congress.
Meanwhile, there is a move to amend the guidelines on the implementation of the free, prior, and informed consent of Indigenous communities. In a statement, 66 Indigenous communities and civil society organizations have complained that the process of amendment has been rushed and exclusionary.
The stage is all set for transition mining.
In the Philippines, the fear of mining is founded upon the storied experiences of communities. In the 1990s, the ADB had once backed the Marcopper mine project in the country. The Marcopper mining disaster – which involved not only a flash flood but the discharge of toxic mine waste – speaks to the unbelievable harm mining does to the environment.
Some community members who suffered from the disaster have yet to enjoy damages awarded by a local court in Marinduque. Marcopper has challenged the verdict at the Court of Appeals. The damage is not a king’s ransom – just 100,000 Philippine pesos (around $1,700) per plaintiff. With the case dragging on, half of the 30 plaintiffs have died, failing to taste the small victory.
The mining industry also has a record of violence: The Philippines has often figured atop Global Witness’ annual list of the most dangerous places in Asia for environmental defenders. Most cases of harassment or downright violence come from the mining sector.
One can imagine then the panic that is starting to grip communities in Kalinga, Palawan, South Cotabato, Sibuyan, Surigao del Sur, and Nueva Vizcaya, to name a few, which house known reserves of transition minerals in the Philippines.
In South Cotabato, the Tampakan mining project is giving farmers and irrigators the jitters as the project affects the Marbel-Buluan Watershed, which feeds agricultural farms. In Kalinga, tribes are at loggerheads with each other over the Malikala mining project.
An ADB official, when told of some of these concerns during a consultation with civil society, said the bank’s support is triggered by government request; CM2CET is not an imposition.
In the movies, a gun introduced at the beginning will need to be fired; this is a plot device known as “Chekov’s gun.” CM2CET can be viewed in the same way.
The ADB plan will prove difficult to resist for governments needing to balance budget sheets with the promised revenue from mining. For companies, an ABD loan reduces their financial exposure and builds their confidence. In its bid to achieve upper-middle-income status next year, and high-income status in 25 years, the Philippine government will be itching to “fire” this “gun.”
The energy transition will lead to an exponential demand for transition minerals. But based on calculations by Mark Mills, there is not enough supply of minerals such as nickel, lithium, copper, and others to back a full transition for solar and wind in the ground transport sector alone, for example.
CM2CET disregards the underlying flaw of the energy transition: a mere change in energy source powering the same economic system. Dominant proponents of the transition see no need for reducing patterns of production and consumption, which are the drivers of ecological breakdown, including the climate crisis. Instead, they have co-opted clean energy to propel the engine of unabashed wealth accumulation, which animates sustainable development. Renewable energy, after all, derisks economic activities from fossil fuels, which are finite in supply, more expensive, and hostage to geopolitics.
Without systemic change, the transition becomes nothing more than a business decision. Without asking tough questions around the irony of investing in mining as a climate solution, the ADB is losing the plot on climate justice.