Page 6 - AsiaElec Week 31 2021

AsiaElec COAL AsiaElec

ADB to lead efforts from Prudential,

Citi, HSBC and BlackRock to speed

up coal closures in Asia

ASIA THE Asian Development Bank (ADB) has per- resources reach $80bn by 2030.
suaded Prudential, Citi, HSBC and BlackRock to The bank said in July that ADB will support
accelerate the closure of coal-fired power plants the development and implementation of its
across Asia in order to rein the generating sec- developing member countries’ (DMCs) ambi-
tor’s emissions. tious climate plans by addressing physical cli-
Reuters reported that the ADB had created a mate risk and safeguarding “just transitions”
potentially workable model for the scheme, with away from fossil fuel-dependent industries.
the bank saying that talks with Asian govern- Meanwhile, the bank has proposed working
ments and multilateral banks were promising. with the major investors through a mechanism
The plan would involve a public-private part- entailing raising low-cost, blended finance,
nership buy out the coal-fired plants and close which would be used to fund a carbon-reduction
them down gradually over a period of 15 years. effort facility, while a separate facility would fund
The interim period would allow staff to be renewable incentives.
retrained and for Asian governments to focus The key issue is that developing economies
on developing renewable energy sources. in Asia have some of the world’s youngest coal
“The private sector has great ideas on how to plants, with more under construction.
address climate change and we are bridging the The International Energy Agency (IEA)
gap between them and the official-sector actors,” expects global coal demand to rise 4.5% in 2021,
ADB vice-president Ahmed M. Saeed said. with Asia making up 80% of that growth.
Saeed said that a first purchase under the The Asia and Pacific region is still heavily
proposed scheme, which will comprise a mix reliant on thermal coal for power and heat gen-
of equity, debt and concessional finance, could eration, which is a major contributor to climate
come as soon as next year. change and air pollution.
“If you can come up with an orderly way The region has the world’s biggest number
to replace those plants sooner and retire them of coal projects in the pipeline, with 78% of new
sooner, but not overnight, that opens up a more plants in the pipeline located in ADB’s develop-
predictable, massively bigger space for renewa- ing member countries.
bles,” Donald Kanak, chairman of Prudential’s Meanwhile, the International Panel on Cli-
Insurance Growth Markets, who came up with mate Change (IPCC) is calling for a drop in
the idea, told Reuters. coal-fired electricity from 38% to 9% of global
The move comes as the ADB has committed generation by 2030, and to 0.6% by 2050.
itself to aligning its operations with the goals of The ADB’s proposal would be to buy and
the Paris Agreement. operate coal-fired power plants, at a lower cost
The bank has set itself the target of ensuring of capital than is available to commercial plants,
75% of the total number of its operations support allowing them to run at a wider margin but for
climate action and ADB’s own climate finance less time in order to generate similar returns.

P6 www. NEWSBASE .com Week 31 04•August•2021