Page 5 - AsiaElec Week 25

AsiaElec COMMENTARY AsiaElec
arguing that for some developing countries in Asia, coal is the only viable option available.
Its 2009 energy policy, for example, allows the use of coal and gas for generation if it sup- ports energy security and poverty reduction.
Nevertheless, it is fully signed up to the Paris Agreement and the United Nations Sustainable Development Goals
“I don’t know whether we will totally dismiss the possibility of coal projects, because in some countries there’s no access to other options,” ADB President Takehiko Nakao said recently.
Coal projects
Despite this gloom, up to 124 GW of coal- red generation capacity is in development across Southeast Asia and South Asia.
“Such a new wave of coal demand is expected to overcome declining demand from China,” said Indonesian coal miners’ association (APBI) chairman Pandu Sjahri.
In Indonesia, he estimated that 52.6 million tonnes of new demand will come online by 2023 to feed domestic power plants.
However, this will partly depends on Presi- dent Joko Widodo’s ability to deliver on his com- mitment to add 35,000 MW of new capacity between 2014 and 2020, with coal accounting for over half of this.Red tape and corruption has held up progress, and the target could now be put back to 2024.
Nevertheless, the commitment to coal expan- sion is complete in Indonesia, alongside the gov- ernment’s target of expanding renewables’ share of power output from 5% now to 23% by 2025.
A case in point is the $3bn Banten Suralaya coal- red generating complex on Java in Indo- nesia. It is planned by state-owned Indonesia utility PLN, with Singapore’s DBS Bank, South- east Asia’s largest nancial services group, acting as advisor and the Export Import Bank of Korea among the lenders.
A group of NGOs has called on DBS Bank to abandon a 2,000-MW coal- red project in Indo- nesia, claiming it would leading to overcapacity issues close to Jakarta – where power access is already almost universal – worsen air pollution and pose great nancial risks for stakeholders.
DBS Bank has already made commitments to ending coal funding – in line with many banks’ commitment to divest from coal – but its policy also claims to target connecting those without power to the grid.
e project has nancial support from South Korea, which along with Japan and China is still a major backer of coal projects across Asia
Looking ahead
e two countries that are raising coal produc- tion and pushing ahead with coal- red power –Indonesia and India– aim to use domestic coal.
As a result, seaborne trading volumes are likely to decline in the medium term as inter- national funding and institutional support for major coal-consuming projects dries up.
Any appetite for imports from China will be dependent on e orts by its government to bal- ance economic growth and pollution, which again heralds potential volatility for trading and downward pressure on prices in future. ™
I don’t know
whether we will
totally dismiss
the possibility
of coal projects,
because in some
countries there’s
no access to
other options
ADB President Takehiko Nakao
Week 25 25•June•2019 w w w . N E W S B A S E . c o m
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