Financing for coal projects is drying up at ever increasing rates as more countries target zero carbon emissions amid an energy transition sweeping the world, participants at Asia’s biggest gathering of the coal industry said on Tuesday.
The exit from coal by big international banks and government-backed agencies, which has accelerated this year, is likely to push coal companies to use offsets to get funding and listed ones to go private to avoid shareholder pressure as the dirtiest fossil fuel is increasingly shunned.
With insurance companies, banks and other financiers pulling out of coal “we are seeing a real tide of all these forces moving in capital markets,” Lachlan Shaw, head of commodities research at ANZ, said at the virtual Coaltrans Asia conference.
“What’s changed more recently is we have seen China, Japan and South Korea all commit to net-zero carbon emissions targets,” he said.
Carbon trading and offsets will become important tools companies to get finance for new projects, so they “can go to the financial markets and say we have a package here that is totally offset from a carbon emissions point of view,” he said.
This article is reproduced at www.reuters.com