15 China-backed coal plants cancelled since Xi’s ban on ‘new projects,’ but loopholes remain
More than a dozen Chinese coal power projects overseas were cancelled after a ban last year on funding such plants, but loopholes could allow 18 others to still go ahead, according to a study published Friday.
China is [...] the largest public funder of overseas coal plants, and was planning to build 67 in more than a dozen countries when President Xi Jinping announced a ban on financing “new projects” in September.
Since then, Chinese developers have cancelled 15 overseas coal projects as funding dried up and host countries demanded greener alternatives, a study by the Helsinki-based Centre for Research on Energy and Clean Air (CREA) said.
But a lack of clear rules has allowed Chinese developers to continue to build new coal power projects, it warned.
“The key concern is that China will continue to fund or build new coal projects to power industrial parks under the Belt and Road Initiative,” said Isabella Suarez, a researcher at CREA, referring to Xi’s U$1 trillion global infrastructure push.
“The loophole is that because the industrial parks have been years in the making, additional coal on these projects would not be considered new, even if… tenders are happening after the pledge to ban coal funding.”
China’s top economic planner issued vague guidelines in March, telling developers to “proceed cautiously” on coal plants that were in the final stages of planning. These could potentially stop Chinese funding for 32 planned coal plants and prompt the “reexamination” of 36 others that are under way, according to the CREA report.
However, “about 18 coal projects (in the pipeline) that can generate 19.2 Gigawatts of power have already secured financing and permits… and could still go ahead,” Suarez said.
Most of these projects are in Indonesia, where China is investing billions to mine nickel and other minerals needed to build electric vehicles, according to data from the Global Energy Monitor.