Gustavo Bernal Torres
Half of China-Backed Overseas Coal Projects Shelved
Of the 52 projects with Chinese financing announced between mid-2014 and the end of last year, 25 have been shelved and eight have been canceled.
Only one project - a power station located in Kalapara, Bangladesh - has gone into operation, a sign that financing costs and risks related to coal projects have surged, while clean energy like solar power have become cheaper to produce.
Factors driving the investment withdrawal include the rising loan spread for coal power plants as financial institutions gained more understanding of climate-related financial risks for high-emitting assets, according to the paper. Emerging carbon pricing initiatives around the world posed greater financial risks to those projects, while a volatile coal price in recent years and the fast declining cost of producing solar power also played a role.