China ends construction of overseas coal-fired power plants
“China will step up its support to other developing countries in the development of green and low-carbon energy and will not build new coal-fired power projects abroad,” said Chinese President Xi Jinping, in a speech to the United Nations General Assembly.
Financial expert Kanyi Lui of Pinsent Masons, the law firm behind Out-Law, said: “Historically, China has been one of the biggest sources of funding for coal projects in developing countries. The maturation of renewable energy technology and rapidly falling costs mean that many developing countries now have viable alternatives to coal power. China will step up support for the transition is likely to speed up the process. “
“This important announcement, along with the Organization for Economic Co-operation and Development (OECD) proposal to relentlessly limit coal funding, could mark the beginning of the end for coal. With its commitments to peak carbon emissions in 2030, its commitment to carbon neutrality in 2060 and now, China is truly playing a leadership role in the fight against climate change, ”he said.
China has already started limiting investment in new coal-fired power plants in developing countries. The Industrial and Commercial Bank of China (ICBC) and the Asian Infrastructure Investment Bank (AIIB) have each indicated that they will no longer support coal. In July, ICBC abandoned its plan to finance a $ 3 billion coal-fired power plant in Zimbabwe.
A Reuters report said the move “could severely limit funding for coal-fired power plants in developing countries.”
If low-carbon alternatives prove unaffordable to coal-fired power generation in some developing countries, donor countries should raise funds to close the financial cost gap, the OECD suggested in July.