While the World Bank and other multilateral development banks are increasingly investing in renewable technologies and phasing out coal power financing, several of the world’s largest national-level funders — East Asian development finance institutions — are among the last public financiers supporting coal power plants.
An analysis led by Princeton researchers has for the first time quantified the contribution of these kinds of development finance institutions in China, Japan, and South Korea to global power infrastructure development. The findings, based on the dataset the researchers constructed, indicate that the China Development Bank (CDB) and the Export-Import Bank of China (CHEXIM) have recently become the largest public financiers of the global power generation sector.
From 2006 to 2015, financing by these two banks resulted in more power plant capacity growth — particularly in coal, hydroelectric, and nuclear plant capacity — than the world’s ten major multilateral development banks’ public lending combined. Given that fossil fuel power plants may operate for 40 years or longer over their lifetime, the fossil fuel-based power generation systems receiving funding and being built now will lock in significant greenhouse gas emissions for future decades. Of all power technologies available, coal-fired power plants are the most carbon-intensive and may also emit health-damaging air pollutants.