China vows to stop building new coal plants abroad
China will stop building new coal plants overseas, President Xi Jinping pledged Tuesday, a move that if fulfilled essentially would end all international financing of the dirtiest fossil fuel. In an address to the United Nations General Assembly, Xi announced that China will not build new coal-fired power projects abroad, along with stepping up support for developing countries in developing low carbon energy, as it seeks to bolster its commitments to address climate change. China had been isolated as the last, and largest, financier of coal globally, after South Korea and Japan joined other Group of Seven nations in committing earlier this year to end international funding for coal.
Xi, however, did not provide a timeline for China ending international support for coal. The move would lock in a trend in recent months of Chinese banks distancing themselves from new coal deals overseas due to guidance from the top, according to Lauri Myllyvirta, an analyst at the Center for Research on Energy and Clean Air.
Indeed, China did not provide funding for coal projects through its Belt and Road Initiative that supports infrastructure in developing countries in the first half of 2021, the International Institute of Green Finance said in a recent report. But the Biden administration has been pushing China to formalize an end to international coal financing, with climate envoy John Kerry visiting the country last month to press for Beijing to declare a moratorium on overseas coal projects.
An end to Chinese finance could lead to the cancellation of over 40 gigawatts of coal projects in 20 countries, equivalent to the size of the current coal fleet of Germany, according to E3G, a European think tank. China, the top greenhouse gas emitter globally ahead of the United States, remains the world's top consumer of coal domestically, and Xi offered no new announcements to curb the country's appetite.
China generated 53% of the world's total coal power in 2020, compared to 44% in 2015, making it the only Group of 20 nation to increase its coal-fired generation significantly last year, according to a report from Ember, a Londonbased research group. Xi announced at a virtual climate summit President Joe Biden hosted in April that China plans to phase down its coal use in the second half of this decade, but he provided little detail.
China has committed to reaching carbon neutrality across its economy by 2060, along with peaking emissions before 2030. Kerry, however, has pressed China to commit to specific near-term actions that would enable "earlier peaking" and the "possibility of rapid reductions afterwards" ahead of a crucial U.N. climate summit in Glasgow this November.