France, US Propose Private Finance Restriction for Coal Plants at COP28
- 21-Nov-2023 2:33 PM
- Journalist: S. Jayavikraman
France, with support from the United States, is set to propose a cessation of private financing for coal-fired power plants in India and Europe. The plan, referred to as the "New Coal Exclusion Policy," was conveyed to India earlier this month, creating a potential rift at the upcoming COP28 summit in Dubai scheduled from November 30 to December 12. India and China, both reliant on coal for their energy needs, oppose any attempts to impede the construction of coal-fired power stations.
Chrysoula Zacharopoulou, France's minister of state for development, shared details of the plan with the Indian government, highlighting its focus on prohibiting private financial institutions and insurance companies from providing support to coal projects. This initiative, known for the first time as the plan to halt private financing for coal-based power plants, aims to address the contentious issue of coal expansion and its impact on global warming.
The United States, European Union, Canada, and other nations are advocating for a comprehensive plan to expedite the global phase-out of coal, citing it as the "number one threat" to climate goals. Their concern lies in continued international financing supporting significant additions to coal capacity in developing countries, particularly India and China. Approximately 490 gigawatts of new coal capacity, equivalent to one-fifth of the existing global capacity, is in the planning or construction stages.
Rick Duke, Deputy U.S. Special Envoy on Climate Change, acknowledged the expansion of coal-fired plants across the world and stressed the need for a swift transition to clean power deployment. He highlighted the urgency to halt the construction of new unabated coal power plants, citing around 500 gigawatts in the global pipeline, a move aligned with the recommendations of the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency.
However, member countries remain divided on emissions abatement technologies that are yet to reach commercial scale for use in developing nations. India, where 73% of electricity is currently coal-generated, intends to resist setting a deadline for fossil fuel phase-out or phase-down at COP28. The country emphasizes that coal will remain its primary energy source for several more decades and may urge developed nations to focus on becoming carbon negative rather than carbon neutral by 2050, while also highlighting efforts to reduce emissions from alternative sources. This positions India to play a pivotal role in shaping the discussions on coal and emissions reduction strategies at the upcoming summit.