Tianjin cityscape

“Green bonds” issued for Chinese coal-burning plants

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A Chinese power producer has issued “green bonds” in order to finance two major coal-burning plants, attracting criticism for the diversion of funds from renewable and carbon neutral projects.

Tianjin SDIC Jinneng Electric Power CO Ltd, based in the northern city of Tianjin, registered the one billion yuan (£113 million) on the interbank market and aims to complete the sale of the bonds by October 2017.

The sale of the bonds will be used to repay loans used to construct two new 1000MW coal-burning plants.

According to Tianjin SDIC, this is first time this sort of “green bond” has been launched within the Chinese thermal power sector.

“The company’s registration and issuance of the green bonds has driven forward the green, circular and low-carbon development of the Beijing-Tianjib-Hebei region,” said Tianjin SDIC in a statement.

The two plants will use super-critical technologies: coal is burnt at high temperature and pressure in order to improve the efficiency of the burning, and comparatively reducing emissions. Super-critical coal-fuelled plants in other countries have been financially supported with the UN carbon-cutting “Clean Development Mechanism” programme.

The support of coal-burning plants as a “green” energy technology has been criticised by environmental pressure groups, who argue that this diverts investment from renewable energy.

“The “clean” in clean coal is a relative term. Technology such as ultra-low emissions, albeit producing less air pollutants, is not a solution to lowering the carbon emissions that endanger our climate,” said Huang Wei, a Greenpeace East Asia campaigner.

“It is unwise to use green bonds to support any coal projects, especially coal power and coal chemical projects.”

The Chinese government has, in recent years, promoted a move towards a more environmentally friendly means of existence. China aims to reduce the share of coal in its total energy production from 64 per cent in 2015 to 58 per cent in 2020, although absolute consumption is still expected to rise, given increasing industrial demands.

Meanwhile, the country makes up a quarter of the global capacity for renewable power, with a further £292 billion aiming to be invested in renewable power by 2020: this makes China the world’s leading investor in clean energy.

In June 2017, the Chinese government launched five “green finance” pilot zones, in which investment of £340 billion from 2016-2010 would aim to reduce local greenhouse gas emissions.

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