Japan’s plan to curb coal plant lending has major “loopholes”

(Global Trade Review, London, 15 July 2020) The Japanese government has tightened its lending criteria for overseas coal-fired power plants, including that it will not provide financial support for any host country that does not have a decarbonisation policy. However, it will continue supporting coal projects if they use highly efficient technologies, and plants that it has already committed to will still go ahead, locking in fossil fuel-based energy for decades. Singapore's business press The Asset notes that Japan generates around 32% of its electricity from coal, with Australia being its main supplier. It is also a major importer from Indonesia, Russia, the United States and Canada. Around 17% of Japanese power generation comes from solar and wind power. Japan has vast requirements for imported coal, oil and gas, and given its lack of resources, does not intend to fully phase out coal. However, local media report that around 100 out of 140 coal-fired facilities will be taken offline between now and 2030. The move marks a partial shift away from Japan’s strong official backing for coal but includes exemptions, leaving some non-governmental organizations sceptical about how much impact the new approach will have.