Citi, HSBC, Blackrock Co-Plan Asian Coal-Fired Closures
A group of global financial institutions, including Citi, HSBC, Blackrock Real Assets and Prudential, are developing a climate change proposal aimed at accelerating the closure of Asian coal-fired plants.
The group – which also includes the Asian Development Bank (ADB) – plans to create public-private partnerships to buy out the plants and wind them down within 15 years, according to a «Reuters» report.
The time period is significantly less than the usual lifetime of such plants and will also create a window for workers to retire or seek new jobs as well as for countries to shift to renewable energy sources.
The group aims to have the model ready for the Glasgow-based COP26 climate conference in November.
Proposed Model
According to the report, the model includes a proposed reduction facility that would buy and operate coal-fired power plants at a lower cost of capital to generate cash flow to repay debt and investors.
The other facility would be used to spark investments in renewables and storage to take over the energy load from the plants as it grows, attracting finance on its own.
«We would like to do the first (coal plant) acquisition in 2022,» ADB vice president Ahmed M. Saeed said, adding the mechanism could be scaled up and used as a template for other regions, if successful.
