August 30, 2018 Read More →

Opinion: Leadership lacking from Asian banks on coal plant lending

Asia Times:

So far, 2018 has seen seven banks dominant in Southeast Asia either release or update their policies related to coal, the single-biggest source of greenhouse-gas emissions worldwide. This number is soon to rise, with Standard Chartered in the final stages of preparing its own coal lending policy update.

The decisions of Southeast Asia’s major banks will have a huge bearing on the region’s energy future. And the energy future of Southeast Asia will have a huge bearing on the future of the global climate.

Public and private banks can literally make or break an energy project when deciding what to finance. This critical role and heightened scrutiny of institutions that also handle the money of hundreds of millions of people has led to banks declaring where they stand on coal power.

Sadly, though, most of the announcements we have seen this year amount to little more than window-dressing.

Take Singapore’s three major banks, DBS, Oversea-Chinese Banking Corporation (OCBC) and United Overseas Bank (UOB). All have produced policies that claim to exclude the most polluting coal power plants. But by setting the bar so low, their policies don’t even apply to the projects they are currently in line to finance, meaning that in effect, nothing changes.

To their credit, several financial institutions have gone much further. In May, Daiichi Life Insurance announced it would not provide project financing for all new overseas coal-fired power projects. Then in July Nippon Life Insurance decided to halt funding to all new coal-fired power generation projects. Also in July, Sumitomo Mitsui Trust Bank stated that it would stop providing project finance for new coal-fired power stations.

But among banks, there is a major leadership void. Step in Standard Chartered. The bank’s new coal policy is an opportunity to set a new tone among its peers, and invest in a way that respects people’s rights to not just clean air and water, but the chance of a safe climate future.

More: The power of finance to slow new coal plants

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