The Asia Miner

APR-JUN 2019

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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the asia miner • volume 16 • issue 2 24 FEATURE: Coal diemme ® FiLTRATiON FAST CYCLiNG FiLTeR PReSS GHT F of new coal plants both domesঞcally and overseas, except in the world's lowest income countries where there are no other economically feasible energy alternaঞves, and if the most efficient coal technology is deployed. The US government is the largest shareholder in the World Bank, the Asian Development Bank, the European Bank for Reconstrucঞon and Development, as well as the African Development Bank. In October 2018, the World Bank made a landmark decision to cease its plans to fund a 500-megawa (MW) coal fired power plant in Kosovo – the last coal project on its books. The then World Bank President, Jim Yong Kim said the Bank could not finance the Kosovo plant even if it wanted to because as the alternaঞves to coal were so much cheaper, the insঞtuঞon's by-laws would not allow it. GLOBAL INSURERS AND REINSURANCE COMPANIES To date, 20 globally significant insurers with more than US$6 trillion in assets and represenঞng 20 per cent of global insurance assets (which stand at US$30 trillion in aggregate) have adopted coal divestment policies, including the four largest European insurers. When smaller insurers and parঞal divestments are included the total is 25 financial insঞtuঞons globally. Coal exclusion policies cover one-third of the global reinsurance market. Policies conঞnue to be enhanced and deepened, with AXA and Allianz now excluding firms who undertake significant capital expenditures in new coal projects. These substanঞve moves by Axa and Allianz focus investor and corporate aenঞon both on exisঞng firms that are high emiers, and on those firms that conঞnue to build new coal capacity, locking in addiঞonal emissions for decades to come. Some examples include Glencore, KEPCO of Korea, Chinese firms in general, and Indian firms Adani Group and NTPC Ltd. There is a recogniঞon that building new capacity drives carbon lock-in for decades to come, which is neither commercially sensible nor strategically aligned with the Paris Agreement. It is no coincidence that 2017 saw the greatest insurance industry losses in history due to natural disasters: US$138bn (on a total economic loss of US$340bn), clearly raised by climate-related losses. The progressive ঞghtening of policies in the global insurance industry is a key posiঞve. Insঞtuঞons are moving from iniঞal greenwash to substanঞve polices with real impact in driving systemic change. This is an abridged version of the IEEFA report Over 100 Global Financial Instuons Are Exing Coal, With More to Come, wrien by Tim Buckley. Tim Buckley, is IEEFA's Director of Energy Finance Research, Australasia. He has over 25 years of financial market experience covering the Australian, Asian and global equity markets from both a buy and sell side perspecve. Tim was a top-rated Equity Research Analyst and has covered most sectors of the Australian economy. Mullateral Development Banks Restricng Coal. ©IEEFA. Source: Corporate announcements, press reports, IEEFA calculaons

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