Japan to tighten state lending for overseas coal power stations: Media

Japan's environment minister Shinjiro Koizumi said that global criticism of his country's "addiction to coal" was hitting home. PHOTO: REUTERS

TOKYO (REUTERS) - Japan will cut state-backed financing and other support for overseas coal-fired power plants by tightening the lending criteria for projects after facing criticism over its policy on the dirtiest fossil fuel, the Nikkei reported on Thursday (July 9).

The move, to be announced later in the day, implies that Japan's strong official backing for coal is starting to shift, although some non-governmental organisations are sceptical whether the announcement will amount to a significant change at all.

Japan's government has received criticism from many quarters over the support, usually through the country's export credit agency, for building coal-fired plants in countries such as Indonesia and Vietnam, as well as the roll-out of new plants at home.

The new policy will have exemptions, including backing for so-called integrated gasification combined cycle power stations that emit about 15 per cent less carbon dioxide than regular plants, the Nikkei newspaper reported.

The country will also continue to fund stations that use a combination of biomass and coal, along with projects that include plans for developing renewable energy.

Officials in the Ministry of Economy, Trade and Industry were not immediately available for comment, when contacted by Reuters.

Japan's environment minister Shinjiro Koizumi said in December that global criticism of his country's "addiction to coal" was hitting home, but warned he had yet to win wider support to reduce backing for fossil fuels.

In May, the Governor of the Japan Bank for International Cooperation Tadashi Maeda was quoted by media saying the bank would no longer accept loan applications for coal-fired power projects.

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