Coal Power Financing. Why have lenders really pulled out, and is this hurting the planet?
(Room Garuda 10A, 1st Floor)
18 Sep 18
4:00 PM
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5:30 PM
Tracks:
TRACK B - Finance & Investment
Over the past decade the international lending and multilateral support agencies have one by one come out stating that they will no longer fund coal fired power projects. Others, while not fully blacklisting coal projects, have placed stringent technology and capacity requirements on their investments, effectively excluding them from investing in coal in developing countries. This is often touted as an ethical response to the global the trend towards a low carbon future, under the umbrella of ‘saving the planet’. Is this really the reason for exiting the coal power market? What is really driving these policies, and are they purely commercial decisions masquerading as ethical corporate responsibility? Where does it stop? Are gas fired plants next on the hit list for international investment? In this paper we will explore the history of selective curtailment of coal power investment by the finance community, and the real reasons behind this. We will also address the negative impacts of the withdrawal of the international investors and multi-lateral agencies, and their accompanying stringent environmental and social compliance requirements, leaving local lenders, who often have lower compliance standards. Certainly the volume coal capacity additions in SE Asia do not seem to be hindered by the international pullback on financing. Is this financing trend really good for the planet?