Ahead of COP, China’s announcement to end financing for coal power plants proves coal is on its way out

Chinese President Xi Jinping’s announcement at the UN General Assembly that the country will not build new coal-fired power plants abroad is a significant step towards a future that is coal-free, WWF-Philippines said.

“This is closing off a significant lifeline for coal in the global energy arena. We need more of these pronouncements and, more importantly, actions by world leaders, and one that we must emulate here in the Philippines. With this announcement by China, they are sending a clear and unequivocal message to the world that coal should no longer be among humanity’s primary energy sources,” Atty. Angela Ibay, WWF-Philippines’ Head of Climate and Energy, said.

The announcement is significant as China is currently the world’s biggest emitter of greenhouse gases, and also an important financing and investment party of overseas coal-fired power plants. Withdrawing overseas coal power investment is an important measure to achieve the objectives of the Paris Agreement.

The announcement from China also comes at a crucial time in the political build up to pivotal meetings in the coming weeks. The global climate COP26 conference starting on 31 October, will see a final push to get leaders to submit ambitious climate plans that will shape the path the world will take to address the climate crisis.

“This is another nail in the coffin for coal. Our next steps should be to permanently bury all coal projects six feet underground,” Ibay said. “This is exactly the push we need to change the ending for the climate crisis. Time is running out, and we challenge the rest of the world to agree to move in the same direction as they meet at COP26.”

In the Philippines, the Department of Energy has issued a moratorium on endorsements for new coal power plants, back in October 2020 which was a crucial first step for the country to transition to cleaner renewable energy sources.

A July 2021 study from the Center for Energy, Ecology, and Development said that proponents of 10 coal projects are still in the process of obtaining permits while 6 proposed projects were allowed to continue.

China is funding 3% of coal power development projects in the Philippines. Globally, China accounts for 55% of the global coal projects that are in the pipeline.

Xi told the UN that China recognizes the “need to accelerate transition to a green and low-carbon economy and achieve green recovery and development.”

“China will strive to peak carbon dioxide emissions before 2030 and achieve carbon neutrality before 2060. This requires tremendous hard work, and we will make every effort to meet these goals,” he said.

WWF’s REpowering Asia initiative in Southeast Asia calls for policy changes to redirect the flow of financing away from coal projects and towards renewables.

Ibay said that the Philippines can transition to clean energy sources since the country has large amounts of potential capacity in geothermal, wind, solar, ocean, and biomass energy sources.

“We have abundant indigenous and renewable energy sources right here in the Philippines, that are ready and can be harnessed. By focusing on renewable energy, coupled with storage, increased flexibility and improvements in the grid, and energy efficiency, we can accelerate the transition to a clean energy future. Thus, our Philippine Energy Plan should reflect the higher target of 50% renewable energy mix by 2030,” she said.

Manuel Pulgar-Vidal, WWF global lead for climate and energy, said: “This marks a clear turning point for the global use of coal in a region where coal has been intensively used. It is also relevant as it comes in a time when we desperately need game-changing commitments.”

“This powerful statement provides a significant signal to coal finance demand countries as well as remaining financiers that the time of coal has long passed,” Pulgar-Vidal added.

Xi’s announcement also included a mention of stepping up support for developing countries in developing green and clean renewable energy sources.

WWF-China’s CEO, Ms. Lunyan Lu, said that “the momentum will further build up if finance can be redirected towards scaling up renewable energy. In cooperation with other countries and development partners, China can lead and accelerate the global clean and sustainable energy transition powered by solar and wind.”###

More information about WWF-Philippines’ call to #ChangeTheEnding by transitioning to a new and green normal can be found here: https://wwf.org.ph/resource-center/story-archives-2020/the-new-normal/