The Government of Denmark will make an initial grant of DKr20 million to establish the Second Danish Cooperation Fund for Renewable Energy and Energy Efficiency in Rural Areas. The fund is aimed at increasing the use of renewable energy in ADB's developing member countries.

The first Danish Cooperation Fund for Renewable Energy and Energy Efficiency in Rural Areas was established in ADB in December 2001 as part of the ADB's Renewable Energy, Energy Efficiency, and Climate Change (REACH) program.

The REACH program was launched in 2002 to promote sustainable development in Asia and the Pacific through renewable energy, energy efficiency and greenhouse gas abatement (REGA) technologies and increase access of the poor to energy services. "Continued support from development partners is paramount in implementing renewable energy, energy efficiency and greenhouse gas abatement technologies in ADB's developing member countries," says Werner Liepach, Principal Director of ADB's Office of Cofinancing Operations.

"We are grateful to the Government of Denmark for this generous contribution that will help us move forward in our sustainable development agenda." The fund will support the increased use of these technologies and expand access to adequate, affordable, and sustainable clean energy services in support of poverty reduction. To scale up its impact, it will take a programmatic approach and focus on a limited number of developing member countries that have significant potential and commitment to these technologies.

The fund will continue to support the REACH program by financing technical assistance operations for project preparation, advisory services and training, institutional support, and other activities that may be agreed upon between the Government and ADB. Renewable energy (RE) has long been viewed as the obvious way to reduce carbon intensity. While most countries worldwide recognize that RE will reduce greenhouse gases (GHG) emissions, progress and success thus far has been mixed. Global barriers to realizing the potential of RE include technology, affordability, and implicit subsidies for fossil fuel use.