SHANGHAI: China's decision to ban overseas coal financing ended 15 power projects in the planning stages with a capacity of around 12.8 gigawatts (GW), and could also stop another 37 GW of capacity currently in the pre-construction phase, new research showed.
However, there are still 18 projects with a capacity of 19.2 GW that are in a "gray area" and could still go ahead, having secured the necessary financing and permits, the Helsinki-based think tank, the Centre for Research on Energy and Clean Air (CREA), said on Friday.
President Xi Jinping announced to the United Nations General Assembly in September that China, the world's biggest energy consumer, would end overseas coal projects as part of its contribution to the global effort to cut climate-warming greenhouse gas emissions.
The move was estimated to involve more than US$50 billion in investments, but it was unclear at the time whether existing construction plans would go ahead.
However, new guidelines published last month by China's state planning agency have added clarity, and could also encourage the reexamination of another 30 China-backed plants now under construction overseas, involving a total capacity of 30 GW, CREA said.
"Projects under construction ... are recommended to proceed 'steadily' and with 'caution'," CREA said. "This leaves options open for Chinese firms to withdraw if they have sufficient reason and manageable penalties to do so, particularly if projects are in earlier stages of construction."
The new guidelines indicate that more than a third of all new coal power projects outside of China and India will now be scrapped.
“China's new directive is the first of its kind - a large emitter with a major global carbon footprint committing to enable low-carbon transitions overseas," said Kevin P Gallagher, Director of Boston University's Global Development Policy Center, which tracks China's coal investments.
China is still building significant amounts of new capacity domestically, with 33 GW going into construction last year, the most since 2016.