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Coal Association Expects Fledgling AIIB to Support Projects

The World Coal Association’s chief executive expects the fledgling Asian Infrastructure Investment Bank to support coal projects once the China-backed development bank begins lending.

Such a decision would help Chinese companies eager to export their coal plant technology, Benjamin Sporton said in an interview Tuesday in Tokyo where he was attending a coal technology conference. The World Coal Association, based in London, is an international industry group counting Rio Tinto PLC and Glencore PLC among its members.

The AIIB is likely to have a “policy fairly supportive of coal technology,” Sporton said

His comments come as some multilateral development banks began limiting public financing for coal in recent years amid increasing calls to reduce greenhouse gas emissions to tackle climate change. Such institutions include the World Bank Group and the European Bank for Reconstruction and Development.

Some 1,199 new coal-fired plants are being proposed with a total capacity of 1,400 gigawatts, many in India and China, according to estimates by the World Resources Institute released in 2012.

International public financing helps developing countries build coal plants with higher efficiency and lower emissions, Sporton said.

“With environmental groups who are saying ‘get out of coal,’ what they are actually risking is worse coal technology being built,” he said.

China is creating the AIIB to finance infrastructure projects. It aims to start funding projects in early 2016, Jin Liqun, the president-designate of the bank, said in Seoul on Wednesday. The lender’s membership will increase to 70 soon, Jin said.

source: http://www.bloomberg.com