Japan Drops Funding For Coal Plants In Indonesia & Bangladesh, Effectively Killing Both
Major coal-fired power plant projects in Indonesia and Bangladesh have effectively been cancelled after the Japanese government, their main funder, recently announced it would stop providing loans to build such plants in the two countries. For Indonesia in particular, the move also means the loss of the top three foreign funders of coal plants in the country, after similar decisions by China and South Korea.
The projects affected by Japan’s decision are the Matarbari 2 coal expansion project in Bangladesh and a plan to build two additional 1,000-megawatt coal-fired units at the Indramayu coal plant in Indonesia. Both Indonesia and Bangladesh had been conducting surveys for the projects with Japan’s backing, but construction hasn’t commenced for either project.
On June 22, the Japanese Foreign Ministry announced at a press conference that Tokyo has decided to withdraw financing for both projects. In light of the announcement, Bangladesh’s energy minister, Nasrul Hamid, said the Matarbari 2 project had been scrapped. “We have already cancelled the plan of Matarbari phase-2,” he told local media. “We plan to build an LNG-based power plant. The plant will be interconnected with the LNG [liquified natural gas] terminal.”
EDIT
The announcement by Japan marks a reversal of policy by Asia’s second-largest economy, which accounted for more than half of the $6.6 billion in coal support pledged by the world’s seven largest advanced economies, or G7 countries, in 2019. Japan is also the G7’s second-largest provider of public finance for fossil fuels, pouring $11 billion into overseas fossil fuel projects each year. This funding has enabled the construction and operation of coal power plants in developing countries like Indonesia, seen as coal’s final frontier due to the country’s overreliance on the fossil fuel to power its economy. Coal, of which Indonesia has abundant reserves, now accounts for nearly 60% of the nation’s electricity generation, a figure that has risen steadily since 2010.
EDIT
https://news.mongabay.com/2022/06/planned-coal-plants-fizzle-as-japan-ends-financing-in-indonesia-bangladesh/
