September 24, 2018 Read More →

Mitsubishi is the latest Japanese firm to take a second look at coal investments

Australian Financial Review ($):

Australia’s biggest thermal coal customer is hardening its attitude towards the fuel, with Japan’s biggest bank and one of Japan’s biggest power and mining conglomerates tightening their coal investment policies in recent days.

Mitsubishi UFJ Financial Group, which is Japan’s largest lender and largest bank by assets, said it was reviewing its lending policies for coal-fired power generation and would limit support to “high-efficiency” generation which helped reduce emissions including through carbon capture and storage. The bank also said its lending would be guided by OECD standards, which encourage lending only to high-efficiency “ultra-supercritical” coal-fired power plants.

The comments came just days after Marubeni, which has equity investments in six Australian coal mines and seven Asian power stations, said it would halve its coal-fired generation capacity by 2030 and double the percentage of renewables in its portfolio by 2023.

“As a general principle, Marubeni will no longer enter into any new coal-fired power generation business. However, Marubeni might consider pursuing projects that adopt best available technology which at present is ultra-supercritical steam-generating technology,” Marubeni said.

The landmark statements from the two companies continue a recent trend among Japan’s top corporations, and highlights the long-term challenge facing Australia’s thermal coal sector, which shipped 41% of its exports to Japan in fiscal 2017.

“It is not just Marubeni moving in isolation … It is more representative of a sea change in senior corporate and government thinking in Japan,” said Tim Buckley, from the Institute for Energy Economics and Financial Analysis, an organisation whose mission is to accelerate the world’s energy transition. “It is a bit like when our big four [Australian] banks all moved two or three years ago.”

More ($): Major Japanese banks, traders tighten coal policy


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