Climate Finance | September 22, 2021

China pledges to end (foreign) coal financing

Amy Cortese
ImpactAlpha Editor

Amy Cortese

ImpactAlpha, Sept. 22 – With less than six weeks until the COP26 climate summit in Glasgow, global leaders are stirring to (modest) action.

China’s Xi Jinping won the day with a pledge to stop financing foreign coal plants. China is by far the largest financier of coal around the world (see End Coal’s finance tracker), with plans to build more than 56,000 megawatts from Brazil to Vietnam. South Korea and Japan, the second- and third-largest financiers of foreign coal plants, made similar pledges earlier this year.

Not mentioned: China’s domestic coal expansion. China added the equivalent to one large coal plant per week last year – more than was retired by the rest of the world.

Still, Xi’s announcement is “a strong sign of coal’s global collapse,” says Carbon Tracker’s Durand D’Souza. Renewable energy will be less costly than coal across China by 2024, the firm says.

Mixed messages

Also at the U.N. General Assembly this week, President Joe Biden promised to double annual funding to help developing nations combat climate change, to $11.4 billion by 2024. Europe, which already contributes $25 billion a year, upped its commitment as well.

Back in the U.S., coal-loving Sen. Joe Manchin is in charge of writing climate policy in the Democrats’ spending bill. Appalachian states stand to gain some $65 billion from solar and wind projects this decade, according to RMI. The New York Times’ Paul Krugman is among those making the case: “Coal Isn’t Your State’s Future.”