Page 8 - AsiaElec Week 26 2021

AsiaElec COAL AsiaElec

Chinese withdraw from ambitious

Zimbabwe coal power plans

VIETNAM THE Industrial and Commercial Bank of China Africa and South America, according to research
(ICBC) has abandoned plans to finance the from Boston University’s Global Development
$3bn, 2,800-MW Sengwa coal power project in Policy Center.
northern Zimbabwe. As well as opposition in Africa, Beijing has
The bank told Go Clean ICBC, a group of 32 sought to lessen coal’s importance in its Belt and
environmental groups, that it would not back the Road Initiative (BRI), which aims to boost Chi-
project, which is being developed by RioEnergy, nese investment across the globe.
a unit of RioZim, because of problems in gaining With Beijing committing itself to meet net
environmental approval, Bloomberg reported. zero by 2060, the government is being more
RioEnergy chairman Caleb Dengu said in careful in funding coal.
2020 that ICBC had signed a formal notice of The ICBC has not yet formally announced
interest in funding the plant, to be constructed its withdrawal from the project, Bloomberg
by China Gezhouba Group, while associated reported.
transmission lines would be built by Power Con- Sengwa had previously been backed by Rio
struction of China. Tinto Group, but it was abandoned in the 2010s.
The 2,800-MW plant had looked to exploit Sengwa was initially owned by London-based
Zimbabwe’s coal deposits in the north of the miner Rio Tinto Group, the one-time parent of
country, but without Chinese backing it now RioZim. Both General Electric and a unit of
looks increasingly in doubt. Blackstone Group looked at the project around
“This is highly significant, obviously for 2016 before declining to take part, pursuant to
Zimbabwe but also for Chinese overseas energy initial inquiries.
financing,” said Lauri Myllyvirta, lead analyst for In 2020, ICBC gave a formal expression of
the Centre for Research on Energy and Clean interest (EoI) in the project and said it was nego-
Air. “It is the first time, to my knowledge, that a tiating with Sinosure, also known as the China
Chinese bank has pro-actively walked away from Export and Credit Insurance Corp., to cover
a coal-power project.” country risk insurance costs.
ICBC has also withdrawn from a similar pro- China has interests elsewhere in Zimbabwe’’s
ject in Kenya. It had planned to back the Lamu power sector, with a consortium of China’s
coal and power project in Kenya, but the Ken- Power Construction Corp. and US-based Gen-
yan authorities have withdrawn environmental eral Electric holding a contract for the 2.4-GW
approval for the project. The African Develop- Batoka Gorge HPP on the Zambesi River on the
ment Bank (AfDB) has also withdrawn support, Zambian-Zimbabwean border.
as it is stopping coal funding. Sinohydro is also adding 600 MW to the
The China Development Bank and the Hwange thermal power plant (TPP) at a cost of
Export-Import Bank of China have funded more $1.5bn and 300 MW to the Kariba South HPP at
than $50bn of coal projects across Asia, Europe, a cost of $533mn.™

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