Page 4 - AsiaElec Week 04

AsiaElec COMMENTARY AsiaElec
Japan’s pro-coal investment policy called into question
Japan’s environment minister has called into question Japan’s financing of coal plants in Asia, writes Richard Lockhart
JAPAN
WHAT:
Environment minister Shinjiro Koizumi has called for the government to stop supporting Japanese financing of a coal plant in Vietnam
WHY:
He says it is counter to Japan’s international commitments to combat climate change
WHAT NEXT:
Japan is unlikely to give up its support for coal, even though its commitment is under consider political and popular pressure
JAPANESE environment minister, Shinjiro Koi- zumi, has called for the government to recon- sider its support for a coal-fired power plant in Vietnam, claiming it breaks Japan’s commit- ments to combat climate change and would be opposed by public opinion.
“This (project) is not something we can get the understanding of Japanese citizens or the international community for,” Koizumi said.
Koizumi said that he intended to speak to government agencies that dealt with energy to rethink the project.
The un-named project is being supported by a subsidiary of Mitsubishi, while Japan Bank for International Cooperation (JBIC) and others are considering lending to the project, Japanese media reported.
He said that he had already sought ways to reduce coal technology exports, but he had been unable so far to come up with specific measures.
Infrastructure exports and energy policies are run by the more pro-coal Ministry of Economy, Trade and Industry (METI).
The Japanese government’s basic energy plan supports investment in coal power only if the cutting-edge, high-efficiency generating tech- nology provided by some Japanese manufactur- ers is used.
Japan currently intends to finance $4.8bn of investment in coal plants in Vietnam, Indo- nesia and Bangladesh, according to a study by Global Energy Monitor that was launched at the UN Climate Change Conference (COP 25) in Madrid in December.
Although Koizumi did not name the project, Mitsubishi, JBIC and a number of Japanese com- mercial banks are involved with the 1,200-MW Vung Ang 2 plant in Vietnam, while Mitsubishi is involved with the Chinese-backed 1,980-MW Vinh Tan 3 plant.
In December, Standard Chartered Bank fol- lowed Singapore’s OCBC Bank in withdrawing from Vung Ang 2, while Hong Kong’s CLP Hold- ings, which is Mitsubishi’s partner in the OneEn- ergy development company, has also announced its exit from coal.
HSBC last week announced that it was no longer involved as financial advisor in the $2bn Vinh Tan 3 project.
Too late
An official at the METI, which oversees energy policy, told local media: “The construction of high-efficiency coal-fired thermal plants meets government standards, and such projects will contribute to cutting carbon dioxide emissions.”
Meanwhile, JBIC said that it had not yet com- mitted any financing, and would follow govern- ment advice.
The project already has support from many government ministries, and Koizumi’s com- ments might be too late.
“It’s difficult to stop the project in Vietnam now,” a senior Environment Ministry official said.
Breaking ranks
Koizumi has effectively broken ranks with the government over coal technology exports, and his remarks come as Japan’s continued financial and technical support for coal projects across Asia runs counter to the current retreat from coal in global investment circles.
Tokyo’s technology giants, investment banks and export support agencies are still committed to coal projects, despite the Japanese govern- ment’s aggressive global initiatives to promote renewables, such as hydrogen fuel.
This is not the first time that Koizumi has spoken out against Japan’s maintenance of a pro- coal policy, which has made it the only G7 coun- try to be still building coal-fired power plants at home. He told the UN COP25 conference in Madrid in December that global criticism of Japan’s “addiction to coal” was beginning to take effect.
Political agenda
Indeed, Koizumi’s opinion carries considerable weight in Japan, where concerns about climate change and emissions are high on the political agenda and in the corporate world.
A recent survey of large corporations by Reu- ters Corporate Survey found that 62% of Japa- nese firms wanted the government to curb its coal-fired power projects, while 20% said Japan should ditch coal plans altogether. Only 18% said Japan should continue to promote coal-fired power.
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w w w. N E W S B A S E . c o m Week 04 29•January•2019